Shareholders approve Axis Bank’s share sale

Shareholders approve Axis Bank’s share sale

Mumbai: Axis Bank Ltd on Thursday said that it has received shareholders approval through postal ballot for issuing 7.14 million equity shares by way of global depository receipts (GDR), qualified institutional placements (QIP) and preferential allotments.

“This resolution enables the bank to raise equity capital at an appropriate time. We are working on the issue," said a senior executive from the bank on the condition of anonymity because he is not the official spokesperson. “However, we have not yet decided as to when to launch the issue," he said.

The bank is expected to raise Rs5,000 crore through these multiple offerings. The preferential issue will allow existing shareholders to maintain their holdings. The Specified Undertaking of Unit Trust of India (SUUTI) and Life Insurance Corp. of India Ltd (LIC), the principal promoter shareholders of the bank, hold 27.02% and 10.34%, respectively. SUUTI’s stake, however, will dip to 22.54% as it will not participate in the preferential issue. LIC will subscribe to the preferential issue to maintain its current holding of 10.34%.

Other promoters of the bank include General Insurance Corp. of India with 2.26%, New India Assurance Co. Ltd with 1.06%, National Insurance Co. Ltd with 0.74%, United India Insurance Co. Ltd, 0.36% and Oriental Insurance Co. Ltd 0.43%. In mid-2007, Axis Bank, then UTI Bank, had raised over $1 billion (Rs4,750 crore now) through a combination of GDR, preferential share issue and qualified institutional placement.