Yes Bank Ltd shares rallied nearly 11% in intraday trade on Tuesday, July 16, as Economic Times reported that a consortium of private equity (PE) firms have offered to buy a major stake in the private lender. Notably, the bank will also be announcing its June quarter earnings tomorrow, July 17.
Sources told the newspaper that a US-based private equity investor has made an offer to acquire stake worth $850 million stake in Yes Bank, the term sheet offer for which was received by the bank over the weekend.
According to the report, the consortium comprises four PE firms – two domestic and two US-based. The consortium leader may pick up a 10% per in Yes Bank, while the rest of them together may acquire another 10%. Yes Bank is likely to make the announcement after its June quarter earnings.
However, Yes Bank, in its clarification note to exchanges, said the bank in the ordinary course of its business continued to explore various means of raising capital/funds through issuance of securities to a diverse set of investors, in order to meet its business/regulatory requirements.
Meanwhile, another report by BloombergQuint said that Yes Bank is looking to raise $1-1.2 billion. However, to avoid excess equity dilution for its existing shareholders, it might do so in two rounds, the report added quoting sources.
At 2.09 pm, shares of Yes Bank were trading at Rs 101.80, up 9.2%, on BSE. The stock has lost 75% of its value in the last one year.
In the March quarter, Yes Bank had reported its biggest-ever loss of Rs 1,506.60 crore as the lender underwent a massive balance sheet clean-up task under new chief executive Ravneet Gill. Since then, investors have had concerns regarding Yes Bank’s asset quality and future growth prospects. Gill had, however, time and again assured investors that the worst is over for the bank and there are unlikely to be any further nasty surprises due to higher bad loans or slippages from its watchlist.
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