Yes Bank Ltd will sell up to 10% stake to U.S. private equity firms Carlyle Group Inc and Advent International for $1.1 billion. Yes Bank will raise the funds through a combination of about $640 million in shares and about $475 million in share warrants.
Yes Bank will offer 3.69 billion shares to affiliates of Carlyle Group and Advent for 13.78 Indian rupees apiece. The company will also issue 2.56 billion share warrants at a price of 14.82 Indian rupees per warrant to both the investors.
Yes Bank has also selected an asset reconstruction company belonging to private equity firm JC Flowers, to help sell bad loans worth around $6.05 billion. Earlier this month, Yes Bank said it would seek to raise about $1 billion in this financial year as it exits a reconstruction plan after two years.
Sunil Kaul, Managing Director and Financial Services sector lead for Carlyle in Asia, said, “YES Bank’s leadership team, led by CEO Prashant Kumar and under the direction of its Board, has done really well in steering the Bank through challenging times, and the Bank is now well-positioned for the next phase of growth. We are excited to leverage our financial services sector experience to be a value-add partner to the Bank as it continues to drive sustained growth, scale its franchise, and focus on investing in its people and leadership team.”
Shweta Jalan, Managing Partner at Advent said, “This investment also demonstrates our commitment to the country’s banking and financial services industry, which is the core of India’s growth story. We think the Bank’s leadership team, led by Prashant Kumar, has done great work in reviving its performance over the last two years.”