Indiabulls Housing Finance has sold a part of its stake in UK-based OakNorth Bank to HighSage Ventures LLC, a Boston investment firm, for Rs 440 crore and will use the proceeds to bolster its capital adequacy ratio.
"The company plans to conclude few other transactions on the partial stake sale in OakNorth Bank over the next few days. The divestment in OakNorth bank will result in boosting CRAR and shall free up capital to grow the loan book of the company,” said Indiabulls Housing Finance, the country’s third largest mortgage lender,
The company invested Rs 663 crore for a 40 per cent stake in OakNorth Bank in November 2015. In November 2017, it sold around 10 per cent of its stake to Singapore government’s investment arm GIC for Rs 770 crore.
OakNorth Bank serves mid-market funding in the UK and within four years of operations its deposits have grown under £ 3 billion. It has lent over £ 4 billion since its launch.
Indiabulls Housing Finance, before selling its stake in OakNorth bank, launched a qualified institutional placement (QIP) aimed at raising funds from institutional investors, with a floor price of Rs 206.70 per equity share. The amount the company is looking to raise has not been disclosed by the mortgage lender. Reports have pegged the amount to be over Rs 700 crore. The proceeds from the QIP will be used to boost the capital adequacy ratio and maintain liquidity to meet funding requirements of its business activities.
The company's shares are trading 3.7 per cent lower than previous days close at Rs 193.70 on the BSE.