Hinduja Group’s IndusInd International Holdings Ltd (IIHL), the promoter of IndusInd Bank, will raise $1.5 billion to increase shareholding in IndusInd Bank from 15 per cent to 26 per cent, and for funding the acquisition of Reliance Capital.
IIHL Chairman Ashok P Hinduja said, “This strategic decision opens boundless opportunities to expand IIHL’s business horizon in India and other global geographies, in the BFSI sector. IIHL’s aspirations will not be capital constrained as raising capital for IIHL is not an issue at all”.
IIHL was the successful bidder for RCap’s stressed assets under the insolvency process with a bid amount of $1.2 billion.
Growth story
“The underlying operating companies in Reliance Capital are in insurance (life, general and health), asset reconstruction, broking, etc and augur well to meet IIHL’s aspirations in the BFSI sector. Global sovereign/ private equity funds have expressed interest in participating in IIHL’s growth story. The company is likely to be listed by the next year and this would also give a trading option to its numerous shareholders who have stayed with the company for over three decades,” the company said in a statement.
IIHL recently acquired a majority holding in a bank in the Commonwealth of The Bahamas and has also received an in-principle approval for a banking licence in Mauritius thereby exploring options to set up a greenfield bank or consider inorganic acquisition. “The company is in the process to acquire asset management and wealth management businesses in order to complete its BFSI (para banking) suite. The IIHL board, celebrating its 30 years of investment in banking, has recommended a special interim dividend at the rate of 10 per cent to reward its shareholders,” the statement added.