Home / Companies / News /  Yes Bank hires Goldman Sachs for $1 billion QIP

Yes Bank Ltd has hired Goldman Sachs Group Inc. to help the lender raise as much as $1 billion through a so-called qualified institutional placement (QIP) offer, according to two people aware of the development.

A QIP is a mechanism through which a listed firm can raise funds by selling shares to institutional investors.

“They have hired Goldman as the lead banker for the offer. They will be hiring more (investment) banks, most likely the same set that was there the last time the bank did a QIP," said one of the two people cited above, requesting anonymity, as he is not authorized to speak to reporters.

In June 2014, the bank had raised $500 million (Rs2,900 crore) through a QIP. Then Yes Bank had hired Deutsche Bank AG, HSBC Holdings Plc, Motilal Oswal Securities Ltd, JM Financial Ltd, UBS AG and Goldman Sachs for the fund raising.

On Monday, in an interview with Bloomberg, Yes Bank managing director and chief executive Rana Kapoor said the QIP will result in dilution of a 12-13.5% stake. He added that the bank is in talks with Goldman Sachs for the fund raising.

A Yes Bank spokesperson could not be immediately reached for comment.

According to the second person cited above, while the bank has gone on several investors roadshows, it has not decided on the dates of the QIP offering.

“They are waiting for the Brexit decision to come out as that is a big uncertainty for the financial markets as of now. Launching such a big deal in the midst of such an uncertain environment would not be prudent," he said.

The UK will hold a referendum to decide whether it will remain a part of the European Union on 23 June. A vote favouring an exit is likely to lead to volatility in global financial markets including India, experts say.

Yes Bank’s QIP will be the biggest such sale so far this year. The market for QIPs has been tepid this year, with just two firms raising around Rs411.9 crore so far, according to data from primary market tracker Prime Database.

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