Axis Bank, India’s third-largest private sector bank, will complete one of the largest private equity investments in the Indian banking sector if its capital raising exercise is approved at the extraordinary general meeting on 8 December.
Axis announced that it plans to raise ₹64 billion (US$1.06 billion) in equity and equity-linked capital by selling shares and warrants to a group of marquee investors. The bank, which received approval for the capital-raising exercise from its board of directors on 10 November, proposes to raise US$1.3 billion through the issuance of equity and US$388 million through the issue of warrants. The clutch of investors includes Bain Capital, BC Asia Investments VII, New World Fund, Euro Pacific Growth Fund and Life Insurance Corporation (LIC) – India’s largest public sector life insurer and Axis Bank’s promoter.
“In India’s banking industry we believe reach, scale and analytics driven underwriting will become increasingly important,” said Bain Capital’s co-chairman, Stephen Pagliuca, adding that the deal promised to be “an exciting growth phase for private sector banks in the country”.
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