AU SFB launches QIP to raise Rs 2.5k cr; sets floor price at Rs 590.8/share

AU Small Finance Bank on Wednesday opened its qualified institutional placement (QIP) to raise up to Rs 2,500 crore, setting the floor price for the issue at Rs 590.84 per share.

The decision was taken at a meeting of the bank's capital raising committee.

On April 29, 2021, AU Small Finance Bank had announced its plan to raise up to Rs 2,500 crore by issuing equity shares through a QIP.

The floor price set for the QIP is lower than the stock's closing price of Rs 609.35 on BSE on Wednesday.

"Further, we would like to inform you that a meeting of the capital raising committee of the bank is scheduled to be held on August 8, 2022 to consider and determine the issue price of equity shares to be issued...including a discount on the floor price, if any," AU SFB said in a regulatory filing.

Separately, the company said its promoter and MD and CEO Sanjay Agarwal intends to sell up to 75 lakh equity shares of the bank, subject to requisite approvals.

"I along with members of promoter group of the bank intend to sell up to 75,00,000 equity shares of the bank, out of the equity shares held by me and the members of the promoter group," Agarwal said in an intimation letter to the bank.

Of the shares to be sold by the promoter and promoter group, 50 lakh shares will be sold for his family and personal financial needs, AU SFB said in a regulatory filing about Agarwal's prior intimation to the company about selling of his shares.

The remaining 25 lakh shares will be sold by MYS Holdings -- a member of the promoter group -- towards commitment to contribute for social and philanthropic causes, he said in the letter.

The promoters had in the bank's annual general meeting (AGM) in July 2020 announced contribution towards social causes.

He said the sale from the promoter group will take place only after completion of any private placement, preferential issue, public offering or any other offering "if undertaken in the next two months from the date of this letter".

He also said the selling price of shares to be sold by the promoters will be at or above the price that may be finalised for any other offering.

The current shareholding of AU SFB promoters and promoter group stands at 28.21 per cent. After completion of the sale, their shareholding will come down to 27.02 per cent.