Financial Daily from THE HINDU group of publications
Sunday, Feb 20, 2005
Financial Daily from THE HINDU group of publications Sunday, Feb 20, 2005 |
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Regulatory Bodies & Rulings Money & Banking - Overseas Borrowings FIPB asks ICICI Bank to reduce size of ADS offering Ambarish Mukherjee
New Delhi , Feb. 19 THE Foreign Investment Promotion Board (FIPB) has directed ICICI Bank to limit its sponsored American depository shares (ADS) offering to the available headroom of 3.29 per cent of the bank's paid-up share capital. This brings down the bank's proposed ADS offering from around Rs 75 crore to Rs 45 crore approximately. The board has also directed the new generation bank to ensure that the total foreign shareholding through all available routes does not breach the 74-per cent cap announced in last year's Budget. Currently, foreign holding in ICICI Bank accounts for 70.71 per cent of the total paid-up capital. The bank had sought FIPB approval for a sponsored ADS offering of up to 6 per cent of the bank's paid-up capital. The board, in a communication to the bank, has stated that foreign shareholding after the sponsored ADS offering "would be determined on completion of the tender process, and the offering size would be reduced to the available foreign holding headroom as determined by the Reserve Bank of India under the trigger limit to ensure that the total foreign shareholding does not exceed 74 per cent of the share capital." To stick to the FIPB limit, only 3.29 per cent of the bank's shareholding can now be disinvested by its existing shareholders in the overseas market. The bank had applied for a sponsored ADS offering of $175 million (approximately Rs 75 crore). The FIPB limit has now reduced the offering to around 44.5 crore, official sources said.
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