Indian private banking group Yes Bank has announced plans to raise $1.1bn (INR89bn) to boost its capital position.
The bank plans to sell up to a 10% stake to each fund affiliated with private equity investors Carlyle and Advent International.
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The funds will be raised through a combination of approximately $640m in equity shares and $475m via equity share warrants.
Yes Bank plans to issue around 3.69 billion shares on a preferential basis to affiliates of the US PE investors at a price of INR13.78 per share.
The bank will also issue 2.56 billion warrants convertible into equity shares for INR14.82 per warrant.
The proceeds will be used to bolster the equity capital base of the bank and support its medium to long-term growth objectives.
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By GlobalDataThe fundraising is subject to receipt of approval from the shareholders and concerned regulatory/statutory approvals.
Yes Bank managing director & CEO Prashant Kumar said: “We are excited about the incremental opportunities that this partnership creates for us and confident that both the investors will play a crucial role in the next growth phase of the Bank.”
Yes Bank has also selected JC Flowers-backed asset reconstruction company as the base bidder for the sale of its bad loans worth INR480bn ($6.05 billion), reported LiveMint.
Carlyle managing director and financial services sector lead in Asia Sunil Kaul said: “We are confident about India’s long-term economic growth prospects and believe that Yes Bank is well placed to capture this growth, given its strong capabilities in transaction banking and digital payments.”
Advent International managing Partner Shweta Jalan said: “We believe India’s banking sector is at an inflexion point where tech-enabled banks like Yes Bank have an advantage. This investment also demonstrates our commitment to the country’s banking and financial services industry, which is the core of India’s growth story.”
