IndusInd Bank promoter IIHL raises money to increase stake; to convert shares at 60% premium

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February 17, 2021 4:59 PM

This would lead of IIHL shoring up additional equity of 1.7 per cent in IndusInd Bank thereby bringing promoter equity to 15 per cent on diluted basis

So, therefore, the expectation is that qualitatively they would be somewhat better than private sector banks,” Haria said.So, therefore, the expectation is that qualitatively they would be somewhat better than private sector banks,” Haria said.

IndusInd Bank has said its promoter IIHL has completed its rights issue, which was oversubscribed at over Rs 2,021 crore. “IndusInd International Holdings Ltd (IIHL), one of the bank’s promoters, confirmed having completed its capital raising through rights issue which was oversubscribed by their shareholders,” said the bank in an exchange filing late night Tuesday.

The rights issue was oversubscribed and IIHL raised capital at an overwhelming premium of 1,400 per cent towards the subscription of this rights issue, IIHL said in a statement. “This reiterates the confidence of IIHL’s global shareholders, spread across 34 countries, in the decision of IIHL and its subsidiary, InudsInd Ltd, to redeem the balance of 75 per cent of the warrants at the price of Rs 1,709 per share (a huge premium over the current market price of Rs 1,059), aggregating to Rs 2,021.45 crore,” IIHL said.

To support the redemption of warrants, IIHL has decided to monetise some of the other mature, non-core investments. The funds from this divestment and the rights issue will be remitted on or before February 18, 2021, as permitted by markets regulator SEBI. Earlier, 25 per cent warrants were subscribed to in July 2019 for Rs 673.8 crore, amounting to 25 per cent of the offer price of Rs 1,709 per piece, it said.

“This would lead of IIHL shoring up additional equity of 1.7 per cent in IndusInd Bank thereby bringing promoter equity to 15 per cent on diluted basis,” said the statement. To support the bank, IIHL had even participated and acquired 1.24 per cent of the preferential equity in September last year, it added. The promoter said it has always been desirous of increasing its stake in IndusInd Bank to 26 per cent. “It is already committed to enabling its investors to have trading and monetising opportunities for their long-standing holdings.

“Towards this, it has raised the debt by pledging some shareholding of IndusInd Bank for acquisition/strategic investment to convert IIHL into a listed operating entity outside India by the first week of September 2021,” IIHL said in the statement. Separately, the private sector lender in a filing said its promoters IndusInd Ltd and IIHL have pledged over 4.27 crore shares of the bank, equivalent to 5.64 per cent, with Catalyst Trusteeship Ltd, acting as security trustee on behalf of lender/s.

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