Family offices throng Yes Bank fund-raiser
Around $1.8 billion of the $2-billion raised by Yes Bank will come from family offices. The bulk of this $1.8 billion investment — $1.2 billion — will come from Canadian industrialist Erwin Singh Braich and SPGP Holdings of Hong Kong, which are classified as family offices. SPGP Holdings is backed by Braich.
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.
Among other investors, Citax Holdings & Citax Investment is looking to invest $500 million, Aditya Birla Family Office $25 million, GMR Group $50 million and Rekha Jhunjhunwala $25 million.
Late on Friday evening, the lender had announced that it had received an interest from a mix of institutional investors and family offices for investing up to $2 billion. The private sector lender had added that none of the investors will be allotted more than 25 per cent of its share capital.
The exact stake to be picked up by the investors will be known after the Yes Bank board meets on December 10. However, all eyes will be on RBI’s approval.
The rules laid out by the central bank caps investment by a single non-financial entity in a private bank at 10 per cent and 15 per cent for financial firms.
The banking regulator can allow a “regulated, well diversified and listed/supranational institution/ public sector undertaking/government” to hold up to 40 per cent in a bank.
The RBI can also “under special circumstances” give its permission on a case-by- case basis. Though the apex bank is generally not keen on allowing a single entity to hold a larger stake in a bank, there are past instances like that of CSB Bank where it allowed Prem Watsa-led Fairfax to gain majority control.
Among institutional investors, a US fund house is keen to invest $120 million, while Discovery Capital and Ward Ferry want to bring in $50 million and $30 million, respectively.
Meanwhile, Yes Bank has invoked 65 lakh pledged shares of Reliance Infrastructure’s promoter between November 25 to 28. These shares, were held by Reliance Project Ventures and Management.