News: YES Bank to raise $70 m thru private placement/QIP

(BL 25/12/2006) Mumbai - Private lender YES Bank plans to raise $70 million within the next three months and is in talks with a few investors for share placement.

"We will adopt either the qualified institutional placement (QIP) or private placement route for raising this capital," Rana Kapoor, Managing Director and CEO, YES Bank said here on Monday. This would be part of $150 million capital raising programme this fiscal.

The bank is already negotiating with a few investors, Kapoor said, adding the plan was to issue around 10-12.5 million shares to these investors. "We are trying to negotiate a higher-than-market price from these investors," he said.

Its aim is to rope-in marquee investors of the calibre of Swiss Re, which recently took a 3.57 per cent stake in the bank for Rs 120-crore ($26.5-million). The bank had issued one crore shares as a part of this transaction.

When asked whether there was a possibility of Swiss Re increasing its holding to five per cent, the maximum allowed under present banking regulations, Kapoor said: "It was up to them to decide. They are, anyway, free to buy our shares from the market. "

Rabobank presently holds 19.29 per cent stake in the bank, the highest foreign holding, followed by three private equity investors - CVC, ChrysCapital and AIF - who together hold around 18 per cent. Fidelity holds a further 4.5 per cent while HSBC and a US-based pension fund hold 2.45 per cent and 1.6 per cent stake respectively in the bank.