Equitas Small Bank to raise Rs 250 crore through private placement

Board of Directors of of Equitas Small Finace Bank (ESFBL/ Bank) had approved to issue of 4,74,58,239 equity shares of Rs 10 each at a price of Rs 52.68 per equity share

Equitas Small Finance Bank (SFB) on Saturday said it would raise Rs 250 crore through private placement of shares.

“India Infoline Finance (IIFL) Special Opportunities Fund, High Conviction Fund Series I and Focus Equity Strategy Fund - Trivantage Capital are the investors,” the lender said on Saturday.

The bank’s board had approved to issue 47,458,239 equity shares of Rs 10 each at a price of Rs 52.68 per equity share (including a premium of Rs 42.68 per equity share) aggregating Rs 250 crore. This will be for a 4.51 per cent stake in the post-issue paid-up share capital of the bank.

At the end of September, the bank’s capital adequacy ratio was at 21.58 per cent with Tier-I ratio at 20.46 per cent.

Equitas SFB is expected to come out with an initial public offering (IPO) by the end of the current financial year, to comply with the licensing guidelines. According to Reserve Bank of India (RBI) guidelines, SFBs have to be listed within three years of launching operations.

Equitas SFB began operations on 5 September, 2016. In September this year, it requested the RBI to extend its listing deadline. The RBI refused and barred it from opening new branches till further orders. The regulator also froze the pay of Managing Director and Chief Executive Officer Vasudevan P N.

Also, the bank’s proposal to list without an IPO, through a merger with the holding company, which is listed, was rejected by the markets regulator. The bank’s management recently said it was confident of listing the shares by March 31 next year.