Global PE investors Carlyle, Advent to pick up 10% stake each in YES Bank

Yes Bank to cumulatively issue 3.69 billion equity shares at a price of Rs 13.78 per share to both investors; each investor will potentially acquire up to a 10% stake in the lender

Yes Bank on Friday announced raising of equity capital of Rs 8,900 crore from funds affiliated with two global private equity investors, Carlyle and Advent International, with each investor potentially acquiring up to a 10% stake in the lender. This will be raised from funds affiliated with Carlyle and Advent International, CA Basque and Verventa Holdings respectively, through a combination of Rs 5,100 crore in equity shares and Rs 3,800 crore through equity share warrants.

The capital raise is subject to shareholders’ approval at the EGM of the Bank to be held on August 24, 2022 and relevant regulatory / statutory approvals.

Prashant Kumar, MD & CEO, YES BANK said, “We are extremely pleased to onboard such pedigreed investors like Carlyle and Advent International as our partners, in fulfilling the long-term strategy of the Bank. This is a testimony to the inherent strength of the Bank’s franchise. We are excited about the incremental opportunities that this partnership creates for us and confident that both the investors will play a crucial role in the next growth phase of the Bank.”

Sunil Kaul, Managing Director and Financial Services sector lead for Carlyle in Asia, said: “We are confident about India’s long-term economic growth prospects and believe that YES BANK is well-placed to capture this growth, given its strong capabilities in transaction banking and digital payments. The Bank’s leadership team, led by CEO Prashant Kumar and under the direction of its Board, has done very well in steering the Bank through challenging times, and the Bank is now well-positioned for the next phase of growth."

The bank's board also approved increase in authorised share capital to Rs 8,200 crore from Rs 6,200 crore currently. 

Yes Bank will cumulatively issue 3.69 billion equity shares at a price of Rs 13.78 per share to both investors.

Yes Bank will issue up to 1.84 billion equity shares to Carlyle at Rs 13.78 per share.

The lender will also cumulatively issue 2.56 billion share warrants at a price of Rs 14.82 per warrant to both investors.

The lender's Board of Directors has approved the convening of an extraordinary general meeting of the shareholders of the bank on August 24, 2022 to increase the authorised share capital of the bank, amendment to the Articles of Association of the Bank, appointment of R Gandhi as independent director.

Shweta Jalan, Managing Partner, Advent International said: “We believe India's banking sector is at an inflection point where tech-enabled banks like YES BANK have an advantage. This investment also demonstrates our commitment to the country’s banking and financial services industry, which is the core of India's growth story. We think the Bank’s leadership team, led by Prashant Kumar, has done great work in reviving its performance over the last two years."