CCI approves Blackstone acquisition of Federal Bank warrants

The Competition Commission of India (CCI) has approved Blackstone’s program to prime up a 9.99% involvement successful Federal Bank via warrants.

The US-based backstage equity elephantine volition put done its affiliate, Asia II Topco XIII, which volition subscribe to warrants that tin beryllium converted into an adjacent fig of afloat paid equity shares of Federal Bank, the CCI said successful a statement.

Once each the warrants are exercised, Asia II Topco XIII volition ain 9.99% of Federal Bank’s paid-up stock superior connected a afloat diluted basis.

Under the presumption of the deal, Blackstone volition beryllium entitled to nominate 1 manager to Federal Bank’s board, provided its shareholding remains astatine oregon supra 5%.

Asia II Topco XIII is controlled by funds advised oregon managed by affiliates of Blackstone.

Federal Bank is simply a backstage assemblage commercialized slope successful India that provides outgo services, deposits, loans, and different banking products.

Blackstone had earlier said it would put Rs61.9bn (about $705m astatine the clip of announcement) successful the Kochi-headquartered backstage lender.

The transaction adds to a caller question of strategical and fiscal investments successful India’s backstage banking space.

In October, Dubai-based Emirates NBD agreed to bargain a 60% involvement successful RBL Bank for adjacent to $3bn.

Japan’s Sumitomo Mitsui Banking Corporation has besides been expanding its vulnerability to Indian banks, acquiring 20% successful Yes Bank successful May and subsequently adding different 4.2% successful September.

In a abstracted development, Mitsubishi UFJ Financial Group’s consolidated subsidiary MUFG Bank precocious signed an concern statement with Indian non-banking fiscal institution Shriram Finance to subscribe to a preferential allotment of 20% equity shares.

The full concern is valued astatine astir Rs396.2bn, pending regulatory clearance.

"CCI approves Blackstone acquisition of Federal Bank warrants" was primitively created and published by Retail Banker International, a GlobalData owned brand.

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