India's Yes Bank to Sell Stake to Private Equity Firms for $1.1B

India-based Yes Bank said it plans to sell up to a 10% stake to U.S. private equity firms Carlyle Group and Advent International for a $1.1 billion price tag, Reuters reported Friday (July 29).

The company is exiting a reconstruction plan after two years, and Yes Bank will look at raising around $1 billion this financial year, the bank said earlier in July.

Yes Bank plans to raise the funds through the sale of around $640 million in shares and $475 million in share warrants.

Yes Bank plans to offer 3.69 billion shares to the banks’ affiliates for 13.78 Indian rupees, or $0.1737 apiece.

In addition, Yes Bank has also selected an asset reconstruction company belonging to private equity firm JC Flowers, to help sell bad loans worth around $6.05 billion.

There has been much written about the burgeoning Indian tech scene, including TradeIndia’s debut of TradeIndia Lending, a loan service for micro-, small- and medium-sized enterprises (MSMEs), a PYMNTS report said.

According to CEO Sandip Chettri, the company had discovered that many small businesses were concerned about raising credit. Many Indian smaller businesses have a large credit gap, a result of a lack of access to capital, incomplete account books and a preference for cash, along with a scant credit history.

See also: B2B Marketplace TradeIndia Launches Loan Service for MSMEs

“This made us introspect if we could be a one-stop solution for the SMEs, where we go beyond providing access to a marketplace by also supporting them in raising funds to meet their next big order,” Chettri said, according to the report.

The report said the platform plans to screen for eligibility for loans and plans to charge a processing fee for the loan screening and part of the interest from the debtor.