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LVB to raise Rs 188 crore from Indiabulls Housing Finance

Shareholders of LVB will get 14 shares of IBHF for every 100 equity shares held in the bank during the merger between the Bank and IHFL

BS Reporter  |  Chennai 

lakshmi vilas bank
Lakshmi Vilas bank

(LVB) is planning to raise around Rs 188.16 crore from Ltd (IHFL) through a preferential allotment of 16.8 million equity shares of the bank at Rs 112 per share.

Shareholders of will get 14 shares of for every 100 equity shares held in the bank during the merger between the Bank and

has offered its support in the interim, while it waits for regulatory approvals for the merger. The bank has been facing a capital crunch and this has impacted its growth in the recent quarters.

said post the preferential issue the capital to be held by would be 4.99 per cent in the bank, even as a merger plan between the two entities is expected to go through various regulatory processes. is scheduled to hold an extraordinary general meeting on May 20 to seek approval from shareholders for the preferential issue.

The preferential allotment has to be completed within 15 days from the date of passing a special resolution by members, subject to other approvals.

The net proceeds from the offer will be primarily for augmenting Tier I capital, subject to compliance with regulations and other approvals. Till the approvals are in, it will temporarily invest funds in creditworthy instruments, including money market mutual funds and deposits or lending with banks or Reserve Bank of India.

The price has been determined as higher of the valuation price of the Equity Shares determined in relation to the scheme of amalgamation between the Bank

and IHFL, as per the joint valuation report on April 4, 2019 issued by independent chartered accountants, Deloitte Haskins & Sells and Walker Chandiok & Co., LLP, appointed by the Bank and IHFL, respectively.

First Published: Fri, April 26 2019. 15:36 IST
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