Private sector lender Yes Bank on Thursday said that US private equity firm Carlyle Group Inc and Advent International have received conditional approval from the Reserve Bank of India (RBI) to buy stake in Yes Bank.
“The Reserve Bank of India has issued a conditional approval in respect of the proposed acquisition of up to 9.99% of the paid-up share capital of the Bank by way of subscription of equity shares and share warrants of the Bank to each investor. Investors are evaluating the conditions,” Yes Bank said in a filing.
“Investors are evaluating the conditions,” the Mumbai-based bank said, adding that they would engage with the central bank to seek an early resolution of the terms and obtain final approval on the acquisition.
The board of Yes Bank had earlier approved 8,898 crore ($1.1 billion) investment by Advent and Carlyle, ending months of negotiations and marking another step on the lender’s path to full recovery.
The money was to be raised by issuing shares worth $640 million and share warrants worth $475 million.
“Yes Bank will raise funds through a combination of approximately $640 million in shares and approximately $475 million in share warrants. It will offer 3.69 billion shares to affiliates of Carlyle Group and Advent. The company will also issue 2.56 billion share warrants at a price of Rs. . of 14.82 per warrant to both the investors,” the private lender had said in a statement earlier.
The proposed sale to private equity firms comes years after the central bank moved to take control of Yes Bank following a dramatic rise in toxic assets, posing a systemic risk to the country’s banking sector to investors and depositors.
In September 2022, Yes Bank approves transfer of stressed assets 48,000 crore to private equity firm JC Flowers in an effort to clean up its balance sheet.
Yes Bank shares closed down 0.58% on Thursday. 17.05 per share on BSE.
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