The Competition Commission of India has approved the proposal of Blackstone, the world’s largest alternative asset manager, to acquire 9.99% stake through warrants in Federal Bank, the fair-trade regulator said in a press release on Tuesday. The acquisition would be done through Blackstone’s arm Asia II Topco XIII Pte. Ltd.
Restructuring
Post the transaction, Blackstone will have the right to nominate a director on the board of Federal Bank as long as they hold at least 5% stake.
In October, the board of the bank had approved this strategic investment which would result in a capital infusion of Rs 6,196.5 crore.
Funds to strengthen the bank’s capital adequacy
The funds from this transaction will strengthen the bank’s capital adequacy, support its next phase of organic and inorganic growth, and accelerate its ambition to rank among India’s top five private sector banks.
On Tuesday, shares of Federal Bank closed 1.5% lower at Rs 265.10 on NSE.