State owned lender Canara Bank on Monday evening said that it has launched a so-called qualified institutional placement (QIP) to raise funds from institutional investors.
According to people aware of the lenders plans, it plans to raise up to Rs2,000 crore.”The base issue size is of Rs1,000 crore with an option to upsize the deal by another Rs1000 crore,” said a person aware of the transaction details.
The company has set a floor price of Rs103.5 per share, as per Sebi formula, for the share sale.The floor price is a 11.84% discount to the bank’s closing price on NSE on Monday.
Investment banks ICICI Securities, Axis Capital, IDBI Capital, JM Financial and SBI Capital Markets are managing the share sale.
“Subject to compliance with applicable laws, our Bank intends to utilize the Net Proceeds for (i) towards augmenting our Bank’s Tier I Capital to support growth plans and to enhance the business of our Bank; and/ or,
(ii) general corporate requirements or any other purposes, as may be permissible under the applicable law and approved by our Board or its duly constituted committee,” the lender said.
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