Yes Bank to raise $2 billion from 8 investors

Marco Green
December 2, 2019

The plan, announced Friday, will see the country's fifth largest private bank with assets of trying to sell new shares worth nearly market capitalization of $ 2.4 billion at the close of trade on Friday.

Yes Bank said discussions with the investors are expected to be concluded shortly even as a binding term sheet has been extended till December 31.

Aditya Birla Family Office and Rekha Jhunjhunwala, wife of stock market investor Rakesh Jhunjhunwala, have committed $25 million each, the bank said. Besides, a top-tier U.S. fund house has evinced Interest to invest $120 million.

Private sector lender YES Bank has increased the size of its equity capital offer to $2 billion from the earlier guidance of $1.2 billion on "strong interest" shown by NRI investors, including a $1.2 billion offer by Erwin Singh Braich and SPGP Holdings, and $500 million by Citax Holdings and Citax Investment Group, according to the bank.

In a regulatory filing on Thursday, Yes Bank had said that a meeting of the board of directors of the company was scheduled for November 29 "to consider and approve raising of funds by issue of equity/equity-linked securities through permissible modes, subject to necessary shareholders/regulatory approvals, as applicable".

The lender's board has on Friday taken the decision to raise up to $2 billion through preferential allotment at a price in accordance with Chapter V of the SEBI Regulations, 2018. According to rules of the Reserve Bank of India (RBI), any acquisition of shareholding or voting rights of five per cent or more will be subject to obtaining prior approval from the regulator. Foreign shareholding in YES Bank was around 40 percent as on March 2019, its annual report showed. It also added that it would raise the money in a share sale with a Canadian billionaire Erwin Singh Braich who will buy more than half of the banks' shares for around $1.2 billion.

Last month, the bank's CEO Ravneet Gill had said that the bank had offers of more than $3 billion on the table. In the previous quarter it had slipped to 15.7 percent and 8 percent respectively, following which Yes Bank raised Rs 1,930 crore via qualified institutional placement (QIP) in August. It has been striving to fund its growth and improve asset quality.

Other reports by Click Lancashire

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