RBL Bank To Mull Fundraise On Oct 18 Amid Emirates NBD Stake Sale Speculations

RBL Bank Ltd. will consider raising funds in a meeting of the board of directors called on Oct. 18, according to an exchange filing on Wednesday.

"The Board will inter alia discuss, consider and if thought fit, to approve the proposal for raising of funds by way of issue of eligible securities of the Bank, including equity shares or any equity linked instruments or securities, by way of preferential issue or a private placement basis or any other methods or combinations thereof as may be considered appropriate", the filing stated.

The announcement comes in the backdrop of speculations over the bank selling a majority stake to Emirates NBD.

The Dubai-based lender is set acquire around 60% stake in RBL Bank for approximately $3 billion, NDTV Profit reported on Monday, citing persons privy to the development.

The transaction is expected to be announced soon, the sources said, adding that this will be done entirely using the fresh equity issuance route.

The transaction will be carried out through the Indian wholly-owned subsidiary of Emirates NBD, after which it will be merged into RBL Bank, the persons further said.

While Reserve Bank of India has not budged on its 26% voting rights cap in this deal, it will likely allow Emirates NBD to acquire and keep its majority stake in RBL Bank, according to the sources.

Considering its dispersed ownership, Emirates NBD is confident that no major resolutions can be passed without the Dubai-based lender saying so, as per the sources in the know.

Post the acquisition, RBL Bank will likely to continue to host its current client base in the retail and medium, small and micro enterprises segments. Emirates NBD will help the lender develop cross-border financing and non-resident businesses through this transaction.

Shares of RBL Bank on Wednesday closed 2.76% higher at Rs 299.55 apiece on the NSE on Wednesday, compared to a 0.71% advance in the benchmark Nifty 50.