RBL Bank To Consider Fundraising On October 18
RBL Bank Ltd. announced that it will consider raising funds in its scheduled meeting of the board of directors on October 18, via issue of eligible securities of the Bank, as per an exchange filing on BSE.
The Board will discuss, consider and if thought fit, to approve the proposal for raising of funds by way of issue of eligible securities of the Bank, including equity shares or any equity linked instruments or securities, by way of preferential issue or a private placement basis or any other methods or combinations thereof as may be considered appropriate.
Speculations Over Emirates NBD Stake Sale
The announcement comes in the backdrop of speculations over the bank selling a majority stake to Emirates NBD. The Dubai-based lender is set to acquire around 60% stake in RBL Bank for approximately $3 billion, NDTV Profit reported on Monday, citing persons privy to the development.
The transaction is expected to be announced soon, the sources said, adding that this will be done entirely using the fresh equity issuance route. The transaction will be carried out through the Indian wholly-owned subsidiary of Emirates NBD, after which it will be merged into RBL Bank, the persons further said.
Reserve Bank of India’s Stance
While Reserve Bank of India has not budged on its 26% voting rights cap in this deal, it will likely allow Emirates NBD to acquire and keep its majority stake in RBL Bank, according to the sources. Considering its dispersed ownership, Emirates NBD is confident that no major resolutions can be passed without the Dubai-based lender saying so, as per the sources in the know.
Post-Acquisition Plans
Post the acquisition, RBL Bank will likely continue to host its current client base in the retail and medium, small and micro enterprises segments. Emirates NBD will help the lender develop cross-border financing and non-resident businesses through this transaction.
Shares of RBL Bank on Wednesday closed 2.76% higher at Rs 299.55 apiece on the NSE on Wednesday, compared to a 0.71% advance in the benchmark Nifty 50.
Impact on Indian Banking Sector
The potential acquisition of RBL Bank by Emirates NBD is expected to have a significant impact on the Indian banking sector. The deal could lead to increased competition in the market, as well as new opportunities for growth and development.
Investors looking to stay ahead of the curve can visit our website for the latest stock market news and updates on the Indian banking sector.
Conclusion
In conclusion, RBL Bank’s decision to consider fundraising on October 18, amid speculations of Emirates NBD acquiring a majority stake in the bank, is a significant development in the Indian banking sector. Investors and traders can stay informed about the latest developments by following our stock market updates and analysis.