After the series of probes continued by the RBI on Bank of Rajasthan (BoR), the Tayals who are the controllers of the bank are out searching for a suitable deal with leading banks to enter into a merger of the bank. The first round of discussions have been held with leading banks like ICICI and some more to search for any lucrative possibility.

"There are differences on valuations and talks have not progressed... A deal could be sometime away," said a senior banker.

The Tayals had also had a discussion with HDFC Bank but HDFC did not show any positive interest in the proposition.

It has been known from sources that ICICI Bank is ready to pay a price which is more than the current market valuation of BoR. It is supposed that Axis Bank may be a suitable match but Axis Bank official has denied any such possibility.

Banking circles say that the Tayals have been put under pressure by RBI as well as SEBi's directives so as to sell their stakes in BoR. Earlier, RBI had directed an exclusive audit of the bank.

RBI has virtually taken over BoR over the last few months.

The merger would mean a lot to the Tayals but only a minor dilution to ICICI.

Given ICICI's market capitalisation of Rs 1,00,717 crore, and BoR's Rs 1,323 crore, a merger would mean a small dilution for ICICI.