Dhanlaxmi Bank has said that>US-based Customers Bancorp Inc. and three private equity firms are withdrawing from the preferential allotment, which was finalised by its board last month. Dhanlaxmi was to raise Rs 290 crore ($64.4 million) by selling 19.6 per cent stake through a preferential allotment.
The Thrissur-based private bank has said that Customers Bancorp will not be able to participate in the issue because of “certain regulatory reasons applicable in the jurisdiction of its incorporation.” Because of this, “other proposed investors have also expressed their reservations in subscribing to the preferential issue,” the disclosure to the exchanges adds.
Customers Bancorp, led by US-based banker of Indian origin, is headquartered in Phoenixville, Pennsylvania, with assets of more than $1.6 billion.
Other private equity investors in the issue included Mount Kellet Capital (a private equity firm run by former Goldman Sachs partner Mark McGoldrick), Wolfensohn Capital Partners (equity fund promoted by former World Bank chief James Wolfensohn) and Multiples. This was one of the first deals for Multiples, a private equity firm started by former ICICI Ventures’ chief Renuka Ramnath.
The share price of Dhanlaxmi was down 3.22 per cent to Rs 115.9 per share in early morning trade on Friday, July 8. The preferential issue was to be made at Rs 140 per share.
Among the bank’s current shareholders are investment firm Bessemer Venture Partners (1.78 per cent stake) and Infosys co-founder and current UID chairman Nandan Mohan Nilekani (1.17 per cent). Dhanlaxmi is headed by Amitabh Chaturvedi, who led the retail operations of ICICI Bank before being the group president of Reliance Capital.
Dhanlaxmi Bank reported 11.8 per cent increase in net profit to Rs 26.1 crore, with its total asset book increasing by 76.4 per cent to Rs 14,268 crore as on March 31, 2011. Total deposits stood at Rs 12,530 crore, with advances at Rs 9,065 crore. The bank, which was incorporated in 1927, has a network of 275 branches and 459 ATMs, covering 136 centres across 14 states.