Yes Bank buys 9.9% stake in JC Flowers ARC to acquire additional stake

 

• Yes Bank intends to participate as a minority shareholder in ARC in partnership with JC Flowers.

• 9.9% stake in JC Flowers ARC at ₹11.43 per share representing 12,370,050 equity shares.

Yes Bank has initially acquired 9.9% stake in JC Flowers ARC. The lender said it plans to acquire another 10% stake in the asset reconstruction company, subject to necessary regulatory approvals. Yes Bank intends to participate as a minority shareholder in the ARC in partnership with JC Flowers.

The 9.9% stake represented 12,370,050 equity shares in JC Flower ARC at ₹11.43 per share.

Both Yes Bank and JC Flowers ARC are in the process of applying for the requisite approvals from RBI.

At around 9.21 am, Yes Bank shares are trading higher at ₹17.30, up 0.58% on the BSE. Its market cap is around ₹ 43,347.04 crore.

On Monday, Yes Bank entered into a share subscription and purchase agreement with JCF ARC LLC and JC Flowers Asset Reconstruction along with CF ARC LLC, JC Flowers ARC, and Amso Asset Management---to acquire a total of 19.9% of the equity share capital in JC Flowers ARC.

Initially, Yes Bank acquired 9.9% stake in JC Flowers ARC, out of the total 19.9%. While the remaining 10% is planned to be acquired in due course, subject to necessary regulatory approvals.

As per the guidelines, prior approval of the Reserve Bank of India--- needs to be obtained by a banking company for acquisition of 10% or more shareholding in an asset reconstruction company (ARC); and an ARC to include any entity as the sponsor of the ARC.

Thus, each bank and JC Flower ARC would require respective approvals for acquisition of 10% or more of the paid-up share capital of the ARC.

Rationalizing the deal, Yes Bank said in a regulatory filing, "The bank intends to participate as a minority shareholder in JC Flowers ARC, in partnership with JC Flowers (a global reputed fund), in the business of asset reconstruction." To participate. It is a subsidiary of the core business of the bank."

JC Flowers ARC is a Property Reconstruction Company incorporated on May 06, 2015. As on March 31, 2022, ARC has a turnover of ₹19.91 Cr.