Yes Bank’s Rana Kapoor is in talks with Paytm to sell his stake in the bank he co-founded, according to media reports.
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Rana Kapoor looks at exiting Yes Bank by selling his and his family’s stake to Vijay Shekhar Sharma for up to Rs 2,000 cr. Kapoor and his family hold 9.64% in #YESBANK of which 69% is pledged with Reliance Nippon Asset Management.@ShereenBhan pic.twitter.com/eC3kewNWh3
— CNBC-TV18 (@CNBCTV18Live) September 10, 2019
Kapoor offered to sell his stake in the bank as well as that of his family members for Rs 1,800-2,000 crore to Vijay Shekhar Sharma, the founder and CEO of the Noida-based mobile payments startup backed by Japan’s Softbank, sources said, reported Moneycontrol.
Kapoor's family owns stakes in Yes Bank directly and through investment firms Yes Capital and Morgan Credits. His daughters Rakhee, Roshni and Radha are directors of the investment companies, Moneycontrol report said.
Kapoor, 62, his family members, and the investment firms they control own a 9.64 percent stake in Yes Bank.
Kapoor has pledged 10 crore shares in the private sector lender worth over Rs 900 crore with Reliance Nippon Life Asset Management Ltd (RNAM), asset manager of Reliance Mutual Fund (MF), according to Mint.
Morgan Credits Private Ltd, an entity linked to his family, has also pledged its 7.02 crore shares in the bank, an intimation to the exchanges said.
Collectively, the stake pledged by both the entities stood at 7.34 percent.
The pledges were created in early June 2019, in favour of Milestone Trusteeship Services, the debenture trustee, for the benefit of the holders of debentures issued by Morgan Credits, the statement said.
The purpose of the pledge, which comes at a time when a host of promoters are struggling to get out of tricky situations created due to pledging, was not immediately known, a PTI report said.
On 9 September, Yes Bank’s shares closed 4.5 percent higher at Rs 63.10 on the National Stock Exchange (NSE). The benchmark Nifty index rose by 0.52 percent and the Bank Nifty index, of which Yes Bank is a part, closed 0.94 percent higher.
The stock markets are closed today (10 September) for Muharram.
At current valuations, the shareholding of Kapoor and his family members is worth Rs 1,550 crore, a report in CNBC-Tv18 said.
If the deal goes through, it will mark the end of the career of one of India’s most-storied bankers and the potential rise of an upstart serial entrepreneur in the banking sector, the report said.
Kapoor, who had to demit office as the executive head of the bank in January this year following a slew of concerns noticed by RBI including those on governance and management, had said that the shares will be passed on to his three daughters.
In May, Yes Bank retracted the performance bonus of Rs 1.44 crore of Kapoor, a report in The Business Standard said.
“The board of directors of the bank had considered and approved clawback of 100 percent of the performance bonus paid to Rana Kapoor for FY 2014-15 (FY15) and FY16, net of taxes. The amount of bonus subject to clawback was Rs 6.2 million for FY15 and Rs 8.25 million for FY16,” said the bank in its annual report on Thursday.
Yes Bank added that it has not paid any bonus to Kapoor for FY17 and FY18.
In June, Kapoor said he was not seeking to return to the Yes Bank board and also backed the new management and board of directors, according to Mint.
In a series of tweets, Kapoor also said that he has voted in favour of all 19 resolutions at the bank’s annual general meeting held on Wednesday.
Kapoor drew a salary of Rs 6.48 crore for the ten months he served as MD and CEO before his tenure ended in January 2019.
Kapoor is one of the founders and promoters of Yes Bank, which started operations in 2004.
The RBI had denied Kapoor an extension to his term twice last year citing serious lapses in corporate governance and a poor compliance culture at Yes Bank as reasons for denial of extension to Kapoor. It asked Yes Bank to find a new CEO by 1 February, exemplifying an increasingly assertive approach to tackling Indian banks’ bad debts.
Deutsche Bank India CEO Ravneet Singh Gill was named the new MD and CEO of Yes Bank from 1 March 2019.
--With agency inputs
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Updated Date: Sep 10, 2019 09:50:05 IST