Catholic Syrian Bank to launch rights issue

Kerala-based private sector lender Catholic Syrian Bank (CSB) today announced it would launch a rights issue to infuse fresh capital of Rs 78 crore. For this, the bank has fixed a premium of Rs 65 on every share with a face value of Rs 10.

The issue would be launched on March 7 and closed on March 21, the bank said. The ratio of the issue is 3:1 and the total number of shares is 10,46,17,81. CSB’s shares are not listed on any stock exchange.

Recently, UAE-based Indian businessman M A Yusuf Ali had made a bid to acquire 4.99 per cent stake in the bank. Ali, who heads the $5.5-billion LuLu Group that owns one of the largest hypermarket chains in West Asia, has sought the Reserve Bank of India (RBI)’s permission for this. He plans to later increase his stake by an additional three per cent.

Ali would buy the stake from Surachan Cahnsri Chawla, an Indian businessman based in Bangkok. Chawla would have to reduce his shareholding in the bank, as RBI had directed him to reduce his stake from 18 per cent to 10 per cent by March-end. A few years earlier, he had bought a stake of about 25 per cent in the bank. The Archdiocese of Thrichur had opposed Chawla’s acquisition of stake, as it felt this would lead to a takeover; it wants the 93-year-old bank to preserve its identity.

Though Yusuff Ali confirmed the reports of his purchase of stake, he didn’t specify the details of the transaction. He said he didn’t want to control the affairs of the bank, adding he was buying the stake as an investment alone. Recently CSB had approved a decision to appoint Rakesh Bhatia, a senior HSBC official, as the bank’s managing director. It is learnt Bhatia might acquire one per cent stake in the bank.

The Lulu Group is set to open its first Lulu Hypermarket at Edappally near here on March 10. It is aggressively buying land in prominent areas here.