Private equity player Bain Capital in talks to up stake in Axis Bank.
Private equity (PE) player Bain Capital has held preliminary talks with Axis Bank to invest in a possible fresh issuance of shares by the bank. US-based Bain holds a 4.6 per cent stake in the lender.
However, it did not participate in the bank’s fund raising efforts last year, through which the lender raised $1.76 billion by selling shares to institutional investors including Singapore’s sovereign fund GIC. Before that, Bain’s shareholding stood at 5 per cent.
In 2017, the lender had approved and conducted a sale of 9 per cent stake to raise Rs 11,626 crore, in a round led by Bain Capital. The PE fund invested Rs 6,854 crore and deal was concluded at Rs 525 a share, while the issue price of the convertible warrants stood at Rs 565.
PE funds can pick up to 5 per cent in a bank under the automatic route, but could go up to 10 per cent with permission from the Reserve Bank of India, according to rules.
While Axis Bank promoters have 16.35 per cent stake, foreign portfolio investors have 45.49 per cent stake in the lender, and MFs control 20.51 per cent.
The bank started looking to raise funds after its asset portfolio, which comprised Anil Ambani group firms and Subhash Chandra’s Essel group, came under serious pressure.