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Punjab National Bank asks arm to reconsider Carlyle deal
Photo Credit: VCCircle

PNB Housing, India’s fourth-largest mortgage lender by assets, said that its parent company Punjab National Bank (PNB) has asked it to reconsider its Rs 4,000 crore ($535.6 million) stake sale to Carlyle Group and others.  

In a letter dated July 4, PNB asked the housing arm to come up with an alternative capital-raising plan in compliance with regulatory rules. 

Last month, PNB Housing Finance challenged regulatory action to delay global private equity major Carlyle’s investment plan for the lender before the Securities Appellate Tribunal (SAT).

The regulator had asked the housing financier to keep on hold the proposal to seek the shareholders’ nod for a preferential allotment of equity until an independent valuation of shares was done.  

The company said it would decide on the issue after the SAT gives its judgment. 

As part of the deal with Carlyle, the Delhi-based mortgage lender said that Carlyle affiliate Pluto Investments will invest Rs 3,185 crore at a price of Rs 390 per share.  

Existing shareholders Ares SSG and General Atlantic will participate in the fundraise. Salisbury Investments, the family investment vehicle of Aditya Puri, who is the senior advisor for Carlyle in Asia and HDFC Bank’s former chief executive and managing director, will also take part in the fundraise.   

PNB Housing said the next hearing before SAT was scheduled for July 12.

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