Several major banks in Asia as well as some deep-pocketed sovereign funds and private equity firms are understood to be eyeing a majority stake of 51 per cent in Yes Bank in a potential deal that would value the bank at over $8 billion. Could be between $9.5. Billion, while the private lender has refused to give approval to the Reserve Bank of India (RBI) to sell 51 percent stake in it.
Five banks – SBI, HDFC Bank, ICICI Bank, Kotak Mahindra Bank and Axis Bank – collectively hold 33.74 per cent stake in Yes Bank, with SBI alone having the largest stake (23.99 per cent stake). Other large categories of shareholders in the bank are: foreign direct investors – 17.95 percent (CA Basque Investments/8.74 percent stake and Varventa Holdings/9.21 percent) and foreign portfolio investors – 10.28 percent.
Indian banks are keen to exit their stake in Yes Bank as their investment, which was part of the ‘Yes Bank Limited Reconstruction Plan 2020’ (framed by the RBI and approved by the government), was made in March 2020 at ₹10. Analysts said that per equity share is only a financial investment and the purpose for which it was created has been fulfilled.
The stake-sale process was initiated earlier this year and names of potential buyers have been doing the rounds since then.
Potential buyers
According to a Bloomberg report, First Abu Dhabi Bank PJSC, Mitsubishi UFJ Financial Group Inc. and Sumitomo Mitsui Financial Group Inc. have emerged as frontrunners to take a 51.69 percent stake in the bank. Sources told separately business Line It is known that other big funds and some PE firms have also shown interest.
On Tuesday, the bank strongly denied reports that its 51 per cent sale plan has received RBI approval. “As stated in the article, RBI has not given any in-principle approval and this clarification has been issued voluntarily by the company to dispel the baseless media article,” the exchange filing said.
On March 5, 2020, the RBI, in consultation with the Central Government, dissolved the board of directors of Yes Bank for 30 days due to the serious deterioration in its financial position. Seven banks and erstwhile HDFC Ltd had invested ₹10,000 crore to rescue Yes Bank. Of this, SBI alone invested ₹6,050 crore, giving it a 48.2 percent stake in March 2020.
Shares of the bank touched a 52-week high of ₹32.85 in February this year, from a low of ₹15.70 in October last year.
(TagstoTranslate)Yes Bank(T)Stake Sale(T)Asian Bank(T)PE Firm(T)RBI
