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Rana Kapoor in talks with Paytm founder to sell stake in YES Bank

“As you understand —this is extremely market sensitive,” Kapoor said in a WhatsApp message.

ET Bureau|
Updated: Sep 11, 2019, 08.15 AM IST
Another exit at Yes Bank over Rana Kapoor's re-entry bid
Reports suggested that Kapoor is in talks with Paytm founder Vijay Shekhar Sharma which may be at a personal level, and which Kapoor neither confirmed nor denied.
Mumbai: Speculation is rife that Yes Bank founder and former chief executive Rana Kapoor may sell his 9.64 per cent stake in the bank as he seeks to cut personal debt and facilitate a fresh round of fund raising by the bank to improve its capital position.

Reports suggested that Kapoor is in talks with Paytm founder Vijay Shekhar Sharma which may be at a personal level, and which Kapoor neither confirmed nor denied.

“As you understand —this is extremely market sensitive,” Kapoor said in a WhatsApp message when reached for a comment. The stock market was shut on Tuesday on account of Muharram.

Late evening Tuesday, in a stock market notice Yes Bank also clarified on another media report which referred to the bank's ongoing efforts to raise capital. “We refer to the captioned news item carried out by Reuters and a few others, which are speculative in nature... the bank in the usual and ordinary course of its business continues to explore various means of raising capital/ funds through issuance of securities to diverse set of investors, in order to meet its business/ regulatory requirements, subject to compliance with prescribed procedures and receipt of statutory regulatory approvals,” Yes Bank said.

Speculation about Kapoor selling his stake comes even as Yes Bank seeks more capital to cover for the provisions the bank has had to make in the last two quarters. Yes Bank CEO Ravneet Gill has been meeting investors in India and abroad in his quest for capital, especially from technology companies as he attempts to re-focus the bank’s strategy.

“The strategic investors we are talking to are people who could significantly ramp up digital enablement. We are talking to a handful of companies, they are big global majors. They will bring analytics on the table which will help us mine data that we have… They would want a fairly large stake. Each of them has indicated that they would like to commit anything between 10 per cent and 15 per cent. What RBI permits now is 5 per cent so it depends on regulatory approvals,” Gill had said in an interview to ET last month.

In the WhatsApp message Kapoor said the bank he had founded was well placed for the future.

"Yes Bank is a terrific home grown large Indian banking institution which has an outstanding leadership team, proven asset quality and resolution / recovery management skills, diversified revenue generating income streams and an efficient cost structure ensuring income sustainability. Equally, the tech-enabled, frugally driven innovative platforms ensure scalable competitiveness and cutting edge differentiation in the Indian banking industry. Yes Bank is well poised in its entrepreneurial growth journey to tackle challenges and seize opportunities in the future as amply demonstrated in the past 15 years - Sept’ 2019 being the 15th year anniversary since commencement in 2004," Kapoor said .

Kapoor and companies controlled by his family own 9.64 per cent stake in the bank, a majority of which is collateral for borrowings through non-convertible debentures in family holding companies.

Last month, ET reported that Yes Capital Pvt Ltd and Morgan Credits Pvt Ltd, the holding companies for the Yes Bank stake controlled by Kapoor, had prepaid a part of the loans they had taken from Franklin Templeton and Reliance Nippon Mutual Fund, as these companies seek to reduce debt.

The Yes Bank stock ended up 4.3 per cent at Rs 63.0 on Monday after an ET story reported Duracell Inc is set to acquire Eveready Industries’ battery and flashlight business.

Paytm founder Vijay Shekhar Sharma did not reply to a message on his phone seeking a comment. It is unclear whether Sharma is interested in purchasing the stake in a personal capacity or it is his company One97 Communications.

Also Read

Rana Kapoor's man Friday Rajat Monga quits Yes Bank

YES Bank drops 5% as Rana Kapoor's YES Capital cuts stake

Another Rana Kapoor company sells 1.8% in YES Bank

Rana Kapoor-owned Morgan Credits pays Rs 792 crore to RNAM

Rana Kapoor, promoter entities sell 2.75% in YES Bank

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