Sebi seeks clarification on SBT's Rs 485-cr rights issue

Capital markets regulator Sebi has sought clarification from the merchant banker of State Bank of Travancore on the firm's proposed Rs 485-crore rights issue.

Without disclosing the details, Sebi said "clarifications (are) awaited from lead manager" for the proposed rights issue.

In rights issue, shares are issued to existing investors based on their holdings at a pre-determined price and ratio.

According to the latest weekly update to the processing status of draft offer documents filed with Sebi, the regulator said clarifications are awaited on the proposed rights issue of State Bank of Travancore as on January 30 this year.

The status is updated on a weekly basis by the regulator and the next update of the status, as on February 6, would be uploaded on Sebi's website the next working day.

Sebi said it might issue observations on State Bank of Travancore document within 30 days from the date of receipt of satisfactory reply from the lead merchant bankers to the clarification or additional information sought from them.

The regulator had received the draft offer documents on January 5 this year through its lead manager BOB Capital Markets Ltd.

The bank proposed to issue equity shares for an aggregate amount up to Rs 485 crore on rights basis to its shareholders, as per a draft letter filed by the lending body with Securities and Exchange Board of India (Sebi).

State Bank of Travancore is a subsidiary of the country's largest lender State Bank of India (SBI).

The bank intends to utilise the net proceeds towards augmenting capital base to meet its capital requirements, primarily loan and investment portfolio.

In June, the Board of State Bank of Travancore had approved raising funds through a rights issue.