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Carlyle-backed PNB Housing ups IPO size, seeks $1.9 bn valuation

18 October, 2016

Mortgage lender PNB Housing Finance Ltd has increased the size of its initial public offering and is seeking a valuation of as much as Rs 12,850 crore ($1.9 billion) through the share sale.

The company now aims to raise Rs 3,000 crore ($450 million), according to its red herring prospectus filed with the Securities and Exchange Board of India. This compares with the Rs 2,500 crore it had planned in the draft red herring prospectus filed in July.

The lender, which received regulatory approval for its IPO last week, on Tuesday set Rs 750-775 as the price band for the offering. The issue begins on 25 October and closes two days later.

PNB Housing is a unit of Punjab National Bank, which holds a 51% stake in the company. After the IPO, the state-run bank will hold about 38-39% of the mortgage lender, according to the red herring prospectus.

Private equity firm Carlyle Group owns the remaining 49% stake in PNB Housing. It had acquired the stake last year when it purchased bulk of the business of New Silk Route-controlled financial services firm Destimoney in its first major buyout in India.

The proposed IPO is entirely a fresh sale of shares. The lender plans to use the proceeds from the share sale mainly to augment its capital base and also for general corporate purposes. The company plans to grow its business and loan portfolio by consolidating its market share and expanding into specific target markets such as the affordable housing segment.

Kotak Investment Banking, BofA Merrill Lynch, JM Financial, JPMorgan and Morgan Stanley are bankers for issue. This is one of the few IPOs where a majority of managers are international banks (click here for a look at which investment banks are raking it in from the surge of IPOs in India).

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Carlyle-backed PNB Housing ups IPO size, seeks $1.9 bn valuation

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