- Hindi news
- Business
- Smfg Eyes $ 1.1 billion additional investment in yes bank; Shares jump over 3%
Mumbai2 minutes ago
- Copy link
Japanese company Sumitomo Mitsui Financial Group (SMFG) is planning to invest $ 1.1 billion (about ₹ 9,400 crore).
Japanese company Sumitomo Mitsui Financial Group (SMFG) is planning to invest $ 1.1 billion (about ₹ 9,400 crore) at private sector bank Yes Bank in India. Apart from this, the company is considering purchasing 5% extra stake in the bank.
SMFG may purchase about 5% stake from Carlile Group and other existing shareholders under a possible deal. Also, Yes Bank also plans to invest in convertible bonds worth about $ 680 million (₹ 5,800 crore).
Today, Yes Bank shares saw a rise of 3% due to the plan of the deal. The stock climbed 2.30% to close at Rs 20.45 until the market was closed. Earlier in May, SMFG announced to buy a 20% stake of Yes Bank.
The deal was done for Rs 13,483 crore with a price of ₹ 21.5 per share. SBI will sell its 13.19% stake in the deal, which is value of Rs 8,889 crore. The remaining 6.81% stake will be purchased from 7 banks like Axis Bank, Kotak Mahindra, ICICI and HDFC for Rs 4,594 crore.
Reserve Bank approval is necessary
The deal will be completed after the approval of regulators like RBI and CCI. SMBC President Akihiro Fukutome said that India is a priority for us. This investment with Yes Bank is part of our long -term strategy. At the same time, CEO Prashant Kumar of Yes Bank said that the investment of SMBC will give new pace to our growth. SBI will still be our important partner.
Yes Bank’s share climbed 14% in 6 months
Yes Bank shares have given negative returns of 22% in the last 1 year. At the same time, a return of 14% has been given in the last 6 months. The stock has climbed 1% in a month. The company’s market capital is 64 thousand crore rupees.
There was talk to buy stake in 2023 too
Earlier in 2023, SMBC wanted 51% of voting rights at Yes Bank, but due to Indian law (26% voting cap), the deal could not be done.
This time the SMBC has accepted the range of 26% voting rights, but the company wants to control the management by nominating its directors in the board of YES Bank.
Yes Bank 1,200+ branches in more than 710 cities
Yes Bank, banking and financial survival provides. The bank has 1,200+ branches, 1300+ ATMs and 8.2 million customers in more than 710 cities. Yes Bank founder is Rana Kapoor. He established this bank in 2004. The bank’s managing director and Chief Executive Officer (CEO) is Prashant Kumar.
