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Yes Bank board approves fundraising of Rs 10,000 crore; rejects Erwin Singh Braich's offer

BusinessToday.In     January 11, 2020

Yes Bank's board approved raising of funds of up to Rs 10,000 crore in one or more tranches through qualified institutional placement (QIP) or any other private placement of equity or debt on Friday. The private lender also said that it would not proceed with the offer made by Erwin Singh Braich/SPGP Holdings.

On November 30, the bank said that a number of investors had shown interest in buying Yes Bank equities of $2 billion, including Braich. Yes Bank said that it was in discussions with the family office of Braich.

The private lender also said that it had received interest from the family office of Citax Holdings Ltd and Citax Investment Group for an investment of $500 million. Yes Bank has said that it is favourably considering the offer by Citax, as mentioned in a report in Livemint. The final decision will be taken in the next board meeting.

The board meeting also had the resignation of Yes Bank's independent director and chairman of its audit committee Uttam Prakash Agarwal in its Friday agenda. Agarwal resigned on Friday citing deteriorating corporate governance standards and compliance failure. Appointed as independent director on November 14, 2018, Agarwal's tenure was scheduled to end in November 2023.

"There are serious concerns as regards deteriorating standards of the corporate governance, failure of compliance, management practices and the manner in which the state of affairs of the company are being conducted by Ravneet Gill - MD and CEO, Rajiv Ubeoi- Senior Group President Governance Controls and Sanjay Nambiar- Legal Head and Board of Directors," said Agarwal in his resignation letter.

The resignation comes after the Reserve Bank of India directed Yes Bank to re-examine the "fit and proper" status of Agarwal after he failed to disclose the details of criminal cases against him. Yes Bank stated that it is reviewing the charges alleged by Agarwal in the resignation letter as well as his "fit and proper" status as directed by the RBI. The bank had sought legal opinions from eminent jurists, which were scheduled to be considered by the board during its Friday meeting. However, Agarwal handed in his resignation before the commencement of the proceedings.

The daily had earlier reported that Yes Bank had received a whistleblower complaint against Agarwal's "fit and proper" status immediately after his appointment. Agarwal had told in response that it was just an omission on his part and all the cases pending against him were civil in nature and were dismissed in 2015 itself.

Also read: YES Bank independent director targets CEO Ravneet Gill, top management in resignation letter

Also read: YES Bank independent director Uttam Prakash Agarwal quits; share price falls over 7%

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