Yes Bank has received an investment offer of $1.2 billion from a family office hailing from North America. The information was revealed by two sources who are familiar with this development. The sources, however, refused to be identified.
Although the discussions between the potential investors and the lender are still going on, the sources revealed that a few private equity funds may also invest either along with the (aforementioned) investor or later.
After the lender spoke about receiving a binding offer of $1.2 billion investment, Yes Bank shares rose to 35 percent on the BSE on Thursday. By the end of the day, the shares were at Rs.70.45 (24 percent higher).
The results for the June-September quarter will be announced on Friday.
In a statement, the bank said it had “received a binding offer from a global investor for an investment of $1.2 billion in the bank through fresh issuance of equity shares, subject to regulatory approvals, conditions as well as bank’s board and shareholders approvals.”
It added, “The bank also continues to be in advanced discussions with other global and domestic investors.”
The name of the investor was not given by the bank.
Yes Bank’s market value suffered a blow owing to a surge in bad loans and changes in the management. It is slowly going back to normalcy, led by CEO Ravneet Gill.
Gill was given the position back in January after former CEO Rana Kapoor was denied another term.
According to one of the sources, there are several investors who are willing to invest but it all comes down to valuation. He also said that a major part of the equity will have to be diluted at the current valuation. Further, the source added that the bank has been in connection with private equity funds but the deal isn’t done as of now.