Indian billionaire Rakesh Jhunjhunwala may remove his name from the list of investors of Yes Bank as he plans on withdrawing his investment of $ 25 million. It is said that the reason he will be shelving his plan is the uncertainty in Yes Bank’s Capital raising plans.
The owner of Rare Enterprises earlier had planned to invest $ 25 million in Yes Bank via Rekha Jhunjhunwala’d (his wife) family office. It is expected that, today, Jhunjhunwala will release an official statement vis-à-vis the investment.
According to a source “the logic behind not subscribing to Yes Bank’s preferential allotment by Jhunjhunwala is that it is higher than the prevailing market price”. Adding that “there is also a lock-in period”. Jhunjhunwala can buy the lender’s shares from the open market at a lower price, without any lock-in period, by this logic Jhunkhunwala will be at a loss, relatively, if he goes with Capital Raising.
Yesterday, Yes Bank’s share closed at Rs. 56.2 on BSE (Bombay Stock Exchange), and the preferential offer (Offer price at which Yes Bank wants to raise funds) is prices at Rs. 78. Today morning, around 9:40 AM Yes Bank’s share price touched Rs. 54.45, down by Rs. 1.75 (3.21%).
Additionally, Yes Bank is rumoured to reject a $ 1.2 billion investment in Capital Raising by Erwin Singh Braich, Canada, and SPGP Holdings of Hong Kong according to reports.
Though, Yes Bank has called both these reports ‘purely speculative’.
Today, Yes Bank’s board is expected to discuss the $ 2 billion Capital Raising in a meeting. Last month, Yes Bank finalised its plan on fund raising.
Read the article here: Yes Bank to finalise Fund Raising Plan