You are here: Home » PTI Stories » National » News
Business Standard

Andhra Bank fund infusion: Govt gets open offer exemption

Press Trust of India  |  New Delhi 

Markets regulator today exempted the from making an open offer pursuant to to its of additional 8.5 per cent stake in under a capital infusion plan.

The exemption granted is subject to few conditions such as the should be in compliance with the and any other applicable

The already holds 61.26 per cent in Post acquisition, its stake will go up to 69.76 per cent.

"The proposed is necessitated on account of the of India's objective that all Public Sector Banks are adequately capitalized for ensuring compliance with Basel III norms," Securities and Exchange Board of (Sebi) said.

As per Sebi's Takeover regulations, no entity can acquire more than five per cent of the additional or voting rights within any financial year unless the acquirer makes a public announcement of an open offer for acquiring of the target company.

Granting exemption, said there will be no change in control of pursuant to the acquisition as the change will only be in the manner of holding the shares by the government.

Further, there will be no change in the number of equity shares held in the bank, by the public shareholders, pursuant to the proposed transactions, it added.

The government, in March, had proposed capital infusion of Rs 1,100 crore in Andhra Bank in lieu of a proposed preferential allotment of over 19.16 crore equity shares.

This was subsequently approved by the board of directors of the bank.

The infusion of additional capital by the government will enable the bank to maintain a capital over and above the minimum requirement mandated under Basel III norms and will also provide the bank with additional leverage for raising further equity capital at a later date, as and when the need arises, said.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Wed, May 17 2017. 18:48 IST