Mumbai: Mid-size private sector lender Yes Bank on Friday said it raised USD 500 million through a qualified institutional placement with domestic and global investors.
The city-based lender, among the last of the banks to start operations, issued 5.35 crore new shares to investors, it said in a statement.
The offer, which was oversubscribed five times, was the first after the new government assumed charge on May 26 and came amid the upbeat sentiment created by Narendra Modi's victory in the Lok Sabha elections.
The issue was priced at Rs 550 per share compared with yesterday's close of Rs 548.15 a piece.
Following the share sale, the bank's total share base will expand by almost 13 percent and the stake of existing shareholders will be diluted by the same proportion.
"This capital raising has been done to further augment our core tier-I capital base/capital adequacy, and enhance the long-term resources," Managing Director and Chief Executive Officer Rana Kapoor said.
The total capital adequacy of the bank has increased to 18 percent, with core tier-I capital adequacy at about 13 percent. The levels were earlier at 14.4 percent and 9.1 percent, respectively, relatively low for a private lender.
Investors from the US and Europe bought 40 percent of the shares, while those from Asia accounted for 30 percent, while the rest went to domestic mutual funds and insurance companies, according to the statement.
Goldman Sachs, Deutsche Equities, HSBC Securities, JM Financial, Motilal Oswal and UBS Securities acted as the book running lead-managers to the issue, it said.
Yes Bank shares climbed 3.56 percent to Rs 569.45 at the close on the BSE on Friday , while the benchmark 30-share Sensex fell 0.07 percent.
The placement by the bank, whose promoters are fighting a pitched battle over individual rights in court, comes after the board approved extension of the deadline for the share sale last month.
Kapoor is entangled in a dispute with Madhu Kapur, the widow of co-promoter Ashok Kapur, over individual rights as promoters.
As of March 31, the stake of the promoter group (MD and CEO Rana Kapoor and Madhu Kapur and family) stood at 25.55 percent.
The RBI wants promoters of banks to gradually lower their shareholding to 10 percent and each bank has submitted its road map to achieve this to the central bank.
