Mumbai: Singapore's state investment arm Temasek, on Friday, said it has completed the acquisition of 4.8% stake in AU Small Finance Bank Ltd by infusing the balance ₹525 crore of its ₹1,000 crore investment plan in the Jaipur-based lender.
The latest capital infusion was done through Temasek’s wholly-owned subsidiary Camas Investments Pte. Ltd, which invested ₹525 Crores towards conversion of its 10.10 million warrants that resulted in increasing its stake to 4.8% from 1.48% earlier.
The deal is part of Temasek’s original commitment in June 2018, to invest ₹1,000 Crores ($141 million) in the lender, with 30% equity capital and remaining 70% by way of convertible warrants issued at a price of ₹692.77 per share.
As on 31 December 2018, Camas Investments had infused ₹475 crore in the form of equity capital of ₹300 crore and convertible warrants application money of ₹175 crore. Further, it carried a right to convert the warrants into equivalent equity shares on or before December 2019 by paying the balance 75% of convertible warrants amounting to ₹525 crore.
“The completion of Temasek’s investment is reflection of the uniqueness of our secured retail and steadily growing granular deposit franchise, our stable portfolio quality, our margins and growth headroom. We are extremely thankful to Temasek for once again reposing their trust in us amidst a challenging macro environment," said Sanjay Agarwal, managing director and chief executive of AU Bank.
Incorporated in 1996 as a non-banking financial company, the company received a license to operate as a small finance bank from the Reserve Bank of India (RBI) in 2016 and started banking operations from April, 2017. In July 2017, the bank got listed on the exchanges and later, in November that year, received the schedule commercial bank status.
As part of its journey towards becoming a bank, the firm sold its 90.10% stake in AU Housing Finance, later renamed as Aavas Financiers Ltd, for ₹828.35 crore to Partners Group and Kedaara Capital in February 2016.
The bank, with most branches in Rajasthan, Gujarat, Maharashtra and Madhya Pradesh, mainly services the retail asset-financing segment, including vehicle finance, loans to micro, small and medium enterprises, construction finance, and loans to other non-bank lenders.
As of 30 September, AU Bank served more than 14.50 lakh customers across 11 states through its 603 touchpoints spread across the country. During the first half of the fiscal 2020, the bank disbursed loans worth ₹8,754 crore and managed loan assets worth ₹27,876 crore. Its deposits during the period stood at ₹22,149 crore, growing 72% compared to the first half of the previous fiscal.