BackCanara Bank arm gets Sebi’s nod for Rs300 crore rights issue
Firm intends to utilise the net proceeds towards 'augmentation of capital base', and enable the company 'to meet future capital adequacy requirements'
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New Delhi: Can Fin Homes has received market regulator Securities and Exchange Board of India’s (Sebi) approval for raising up to ₹ 300 crore through a “rights issue". In a right issue, shares are issued to existing investors based on their holdings at a pre-determined price and ratio. The company filed its application with Sebi for the proposed rights issue in September.
Sebi issued its final “observations" on the draft offer documents on 8 December, according to the latest update by the capital markets regulator. Issuance of “observations" on offer documents by Sebi is considered as a clearance to the issuer to go ahead with the share issues through routes like IPOs, FPOs and rights issue. Can Fin Homes, promoted by Canara Bank, is primarily engaged in the business of housing finance.
The company intends to utilise the net proceeds towards “augmentation of capital base", which would result in an increase in net worth and enable the company “to meet future capital adequacy requirements".
SBI Capital Markets is the lead manager to the issue, while Karvy Computershare is the registrar to the issue. In July, the board of Can Fin Homes had approved raising funds through a rights issue. At the end of 30 June 2014, the company had gross and net NPAs (non-performing assets) of ₹ 1,843.04 lakh and ₹ 632.62 lakh respectively.
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