While the bank did not name the investor, according to reports, it was Hong Kong-based SPGP Holdings.
Mumbai: Shares of Yes Bank jumped 35 per cent before closing with gains of 24 per cent after the lender informed the exchanges that it has received a $1.2 billion binding offer (around Rs 8500 crore) from a global investor. The bank is yet to consider the offer, it said.
While the bank did not name the investor, according to reports, it was Hong Kong-based SPGP Holdings. The bank said that it continues to be in advanced discussions with other global and domestic investors.
Analysts said the amount being offered by the global investor is sizeable enough to take care of future growth besides helping the bank maintain the minimum capital requirements. “One of major overhang on capital will get elevated. But the name of the investor, timing of the capital infusion and central bank’s comfort with this proposal needs to be watched for,” said an analyst.
K Vijaykumar, Chief Investment Strategist at Geojit Financial Services, said, “Yes Bank is badly in need of capital for growth. Absence of positive news on this front led to bear hammering in the stock, taking the stock below Rs 30. It is natural that investors are finding it attractive to invest in the stock for a stake. Further developments will depend on who the investor is and the regulatory approvals."
The Yes Bank board is likely to consider the offer along with other proposals as well as results today.
The shares of Yes Bank closed 24.03 per cent higher at Rs 70.45 on the BSE, making it the world’s best performing bank share this month. The bank has now recovered over 150 per cent from its 52-week low of Rs 29.05 hit on October 1.
The bank had earlier on September 25, 2019 informed the exchanges that it had received strong interest from multiple foreign as well as domestic private equity and strategic investors for the capital raise and remains firmly on course to raising growth capital subject to necessary approvals. According to reports, the lender has been in talks with private equity investors, tech companies and family offices.