The new generation private sector UTI Bank has finally received unanimous approval from its shareholders to raise equity capital of over $1 billion through a mix of global depository receipts (GDRs), qualified institutional placement (QIP), and a preferential allotment to promoters, using both the domestic and overseas routes.
This was decided at the reconvened extraordinary general meeting (EGM) of the bank on Friday. The EGM last month had been inconclusive, since the largest shareholder, the Specified Undertaking of Unit Trust of India (SUUTI) sought time to decide on its own subscription and whether a domestic retail offering was necessary.
The bank plans to dilute 15% of its existing equity through the proposed issue and preferentially allot a proportionate number of shares to its promoters, SUUTI, Life Insurance Corporation (LIC), GIC RE and other state-owned general insurers, so that their holdings in the bank, post-issue, remain at the existing level. SUUTI is the largest shareholder in the bank with a 27.43% stake and LIC owns 10.38% of the bank?s equity. The combined share of the remaining promoters is 5.28%. ?We will follow the book-building process for both the GDRs and QIP (both domestic and overseas) probably next week.