Yes Bank mulling QIP to raise $300 mn by December

New-generation lender Yes Bank plans to raise $300 million (about Rs 1,200 crore) by December for its expansion plans.

While all options are being considered, it is understood that the private bank is zeroing in on the QIP route to raise these funds.

Yes Bank is currently fine-tuning its expansion plans over the next 1-2-year period, aimed at solidifying its position in the domestic market.The bank aims at a strong 250 branch networkby September 2010.

At present, the bank has 67 branches across the country. The lender proposes to launch its asset reconstruction company in the next few months and plans to enter the retail broking and asset management businesses over the next 18-24-months.

Yes Bank eyes two private sector banks for acquisition

Private sector lender Yes Bank has zeroed in on two banks as possible acquisition targets and could execute the buy-out in 2009-10.With bank valuations still at reasonable levels and not expected to increase in the medium-term, an acquisition would certainly be attractive, said Rana Kapoor without giving the names of the two banks in its radar.

Recently, HSBC Bank hiked its stake in the bank to 4.88 per cent, which Kapoor termed as "a purely financial investment".While Kapoor remained tight-lipped, the banking industry grapevine feels Karnataka Bank, Karur Vysya Bank and Kerala-based Catholic Syrian Bank, Federal Bank and South Indian Bank could be potential acquisition targets.

HSBC investment arm buys 4.99% in Yes Bank

HSBC Financial Services Middle East has picked up a 4.99 per cent stake in Yes Bank in the secondary market.The global investment arm of HSBC has been investing in the bank since January.Rabo Bank holds around 18 per cent in Yes Bank.

While HSBC refused comment on Tuesday, the strategic investment in Yes Bank has set the market abuzz with rumours. This is the second strategic investment made by the HSBC group in a bank after its investment in Axis Bank (earlier called UTI Bank). The group now holds a 4.96 per cent stake in Axis Bank.

In the recent past, Citigroup had picked up around 12 per cent in HDFC. Analyst saw Citi’s acquisition, and its indirect stake in HDFC Bank, as a strategic move to get ready to buy an Indian bank once the RBI eases the rules for foreign banks to enter India.

According to the RBI norms, foreign banks are allowed to buy up to 5 per cent stake in a bank. Annually, all foreign banks operating in India receive permission to open around 12 to 14 branches.

Read more in The Business Standard article.

Yes Bank to raise funds through institutional placement

Private sector lender Yes Bank will raise funds by way of issue of shares to institutional investors.

The shareholders at the extra ordinary meeting approved the allotment of up to two crore shares to Qualified Institutional Buyers, the bank said in a filing to the Bombay Stock Exchange.

Foreign banks eye stake in Yes Bank

Two leading foreign banks have evinced an interest in picking up to 4.9% stake in Yes Bank. A tie-up would help Yes Bank add muscle to its trade-finance and cross-border transaction capabilities besides enhancing its global distribution reach, Rana Kapoor Chairman Yes Bank said.He, however, declined to divulge the names of the two foreign banks but said that "only American and European banks interest us presently." He denied reports that HSBC and Standard Chartered Bank had indicated any interest in Yes Bank.

Categorically ruling out ceding management control to any outside entity, Kapoor said that under no condition would the promoters' holding be allowed to drop below 30%. Presently, it stands at 34%.

The bank already has foreign holding with marquee investors holding stakes. While Netherlands-based RaboBank holds an 18% stake, Global Orient of Singapore holds 4.99%. Swiss Re holds 3.4%.

Yes Bank raises Rs 1.82 bn in debt

Private sector lender Yes Bank said over the weekend it raised Rs 1.82 billion through private placement of bonds to augment its capital adequacy. The bank said in a statement it had placed unsecured, redeemable, non-convertible, subordinated bonds worth Rs 500 million with an option to retain the oversubscription.

The fund raising is part of a plan to raise Rs 8.4 billion in equity and debt. Yes Bank said it would privately place or sell 20 million shares to qualified institutional buyers to raise up to Rs 5 billion.The rest would be raised in Tier I and Tier II debt, it said.

Indian banks, including the largest lender State Bank of India, are raising debt and equity to sustain high loan growth and meet the central bank's capital adequacy norms.State-run State Bank of India plans to sell shares worth Rs 100 billion around the end of 2007 and Bank of India also plans to sell some stake.

Yes Bank Plans To Hive Off Investment Banking; To Sell 6.7% Stake

Yes Bank plans to hive off its investment banking business into a separate subsidiary, Reuters (DNA) reports, quoting the bank's founder and CEO Rana Kapoor. This is likely to happen before March 2009. “We can even do it before that though it will not be until we build up scale and our track record,” Kapoor told the wire agency.

Yes Bank has been picking up quite a few capital raising initiatives or M&A deals recently. In November 2006, Yes Bank advised United Phosphorus in its $142-million acquisition of Cerexagiri, the crop protection unit of French chemicals company Arkema. Yes Bank was one of the advisors for Suzlon in its acquisition of German wind turbine maker REPower. It also advised Sintex Industries in acquiring the US-based Wausaukee Composites Inc for $20.5 million. Yes Banks' most recent deal was as advisor to InfrasoftTech when the latter secured $25 million funding from Baring Private Equity last fortnight.

Kapoor's logic is this: “We are doing big deals in investment banking and this (spinning the unit off) is the best way to attract better investors. Independent businesses make more sense." He said that the bank "plans to build a niche for itself" by focussing on companies in the knowlege economy and emerging corporates keen on fund raising and acquisition, and in outbound M&A. Yes Bank is also planning an entry into microfinance business. Kapoor also said that Yes Bank is planning a $100 million private equity fund, although details are not available. Yes Bank already has set up an agri business fund, which could have a corpus of $100 million.
Kapoor also said the bank is in "active discussion" with financial investors abroad to raise up to $120 million by diluting 6.7 per cent stake either through private placement of shares or through qualified institutional placement, Reuters reports.

Read more in The DNA Money article.

Yes Bank floats $100 m agro fund

Yes Bank has launched a $100 million food and agribusiness India fund. The private equity fund plans to invest the entire amount in the next 1-2 years, with an investment between $5 million and $7.5 million per company. It is targeting average annualised returns between 20 per cent and 25 per cent.

The bank is in talks with 10 investors, including insurance companies, bilateral institutions and commercial banks who have expressed an interest in contributing to the corpus.

The fund will invest in companies operating in fruits and vegetables such as grain-based products, milk and milk-based products, poultry, spirits and beer, tea and coffee, confectionery, farm seeds, food services, food retail, food logistics and agri-infrastructure, including agri-market and cold storages sectors.

Read more in The Business Standard article.

Yes Bank launches PE fund for agri biz

Private sector lender Yes Bank has launched Rs 400 crore private equity fund under which it would raise money through institutional investors for putting in agribusiness.

The objective of the fund is to invest in food processing companies with high growth expectations and obtain a minority position in such companies, Yes Bank Senior Director Agribusiness Funds Management Sonal Shah told reporters here on Wednesday.

The fund would be raised through a mix of global and domestic investors, Shah said, adding that the bank is open to raise funds through high networth individuals (HNIs) also.

Yes Bank is targeting an annual return of about 20-25 per cent from the investment through the new fund.

The bank plans to invest the entire portfolio in the next 1-2 years in 10-15 companies, Shah said, adding the investment would be in the range of $5-7.5 million per company and the bank is already in the process of shortlisting the companies where it intends to invest.