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The private investment group Bain Capital intends to sell a share of its stock from Axis Bank in a block sale.

The private investment group Bain Capital intends to sell a share of its stock from Axis Bank in a block sale, according to media sources,

Bain Capital would probably sell a 1.24% share in Axis Bank for $410 million (Rs 3,400 crore) through block agreements. The share price floor has been set at Rs 888, which is 2% less than Monday’s closing price of Rs 906, according to a term sheet released by the banker JP Morgan,

The shares will be sold by a division of Bain Capital called BC Asia Investments.

In May of last year, the government sold 1.95% of Axis Bank to collect nearly Rs 4,000 crore. Specified Undertaking of The Unit Trust of India held these shares (SUUTI).

axis bank, asian paints, indusind, nestle among top gainers & losers as market ends in red - businesstoday

After Bain Capital liquidated a portion of its holding through block trades on the markets, Axis Bank shares ended in the red.

On the BSE, the Axis Bank share priced out 3.76 percent, or Rs. 34.10, lower at Rs. 871.75.

According to exchange data, the Bain subsidiary BC Asia Investments VII Ltd. sold 16,680,000 shares for about Rs. 1,487 crores at a price of Rs. 891.38 per share. This represents a savings of around 1.60 percent off its closing price.

As of September 30, 2022, Bain Capital’s three funds, BC Asia Investments VII, BC Asia Investments III, and Integral Investments South Asia IV, owned 4.24% of Axis Bank NSE -0.94%.

Separately, the lender reported a 70% increase in net profit for the September quarter, coming in at Rs. 5,329.77 crore.

Following a 14% increase in assets and a 0.57 percentage point increase in the net interest margin to 3.96 percent, core net interest income increased by 31% to Rs 10,360 crore. To Rs 3,941 crore, other income rose 4%.

axis bank stake sale: bain capital to sell 1.2% in bank for $410 million

In 2017, Bain Capital funded money in Axis Bank.

After a spate of underwhelming earnings in 2017, Axis Bank received a lifeline when a Bain Capital-led consortium agreed to invest $1.8 billion in the nation’s largest private equity deal to support the lender’s capital base.

In order to strengthen Axis Bank’s capital base following a spate of underwhelming earnings, a consortium led by Boston-based Bain invested $1.8 billion (Rs 11,626 crore) in “confidence capital” in the private lender in November 2017. Equity shares were issued at a price of Rs. 525 per share, while convertible warrants were issued at a price of Rs. 565 per share. During the fundraising campaign for the private sector bank, Bain Capital invested approximately Rs 6,854 crores.

Sanjeev Krishan, leader, private equity, PwC India, stated that This investment by the Bain-led consortium in Axis may be a forerunner to many more — some larger, some smaller — transactions in the Indian banking industry. “The purchase is, in some ways, the beginning of a journey for larger PE investors looking at impaired assets in India. Banks (like Axis) have enormous and complex organizational structures, so patient, long-term funding from a fund like Bain would help change how the world views the Indian banking industry,” he added.

“Bain Capital has been and is positive about India and is pleased that recent changes bode well for the country’s next phase of economic growth. This is just another sign of the same, having made some of the largest private equity commitments to the country,” according to Amit Chandra, managing director and head of Bain Capital’s Indian operations.

The money was raised through a combination of new equity and warrants that could be converted into shares, making it one of the largest private equity investments in the domestic banking sector at the time.

bain capital private equity

About Bain Capital

With a market value of $813.5 million, Bain Capital Specialty Finance Inc. ranked 62nd out of all companies in the Investment Management & Fund Operators sector.

The price-earnings ratio for Bain Capital Specialty Finance Inc. is 8.5 at the moment. The trailing 12-month sales for Bain Capital Specialty Finance Inc. was $199.5 million, with a 48.4% profit margin. The most recent quarterly sales growth over the prior year was 12.7%. For the current fiscal year, analysts forecast adjusted earnings to come in at $1.472 per share. The dividend yield for Bain Capital Specialty Finance Inc right now is 10.7%.

Private equity and venture capital firms like Bain Capital often have a four- to six-year holding period before looking for a strategy to sell portfolio companies for a profit.

The company makes investments in the business, media, telecommunications, retail, dining, healthcare, technology, and consumer sectors. International clients are served by Bain Capital Private Equity.

About Axis Bank

Axis Bank Ltd. (Axis Bank) offers consumer and business banking services as well as additional associated financial solutions. Accounts, savings, cards, loans, investment products, NRI services, and banking for agriculture and rural areas are all examples of personal banking. Corporate accounts, corporate loans, capital market services, trade, and forex, as well as treasury services like foreign currency, derivatives trading, equities, and mutual funds, are all part of business banking.

In addition, the bank offers insurance plans for life, health, travel, vehicles, and businesses. It provides services to private clients, businesses, SMEs, the government, and NRIs. It is active in the UAE, Bangladesh, Singapore, the UK, India, and the UK. Mumbai, Maharashtra, India is home to the headquarters of Axis Bank.

 

edited and proofread by nikita sharma

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