PNB raises Rs 5,000 cr via qualified institutional placement

Reuters | Updated on January 09, 2018

The total fund-raising of Rs 5,000 crore, including the upsize option, is aimed at boosting the bank's capital ratio.

Punjab National Bank has raised Rs 5,000 crore ($777 million) through qualified institutional placement of shares priced at Rs 168 apiece. The QIP involved a base of Rs 3,000 crore, or 179 million shares, with an option for a size increase of Rs 20 crore, or 119 million shares, which was fully exercised.

The total QIP involves 14 per cent of the bank's share capital. Under the current regulations, the state-owned Indian bank could offer an additional discount of up to 5 per cent to the floor price of Rs 176.35. The final price was at a 2.9 per cent discount to the pre-deal close of Rs 172.95 on the National Stock Exchange. PNB shares were up 0.2 per cent at Rs 173.70 today on the NSE.

Around 59 investors participated in the transaction and the top 10 were allocated 80 per cent of the deal. Local investors were allocated 75 per cent. State-owned Life Insurance Corp of India is said to have bid for half the deal but was allocated much less than what it bid for. Bank of America Merrill Lynch, Credit Suisse, Goldman Sachs, HSBC, Kotak, Morgan Stanley and PNB Investment Services were the bookrunners.

Published on December 12, 2017

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