The Carlyle Group along with other entities on Monday floated a “draft letter offer” with regard to an open offer for acquisition of over 7 crore equity shares representing 26 per cent stake in PNB Housing Finance.
This forms part of the proposed deal to invest ₹4,000 crore in the company through a preference issue.
An open offer is a mandatory offer an acquirer and persons acting in concert (PACs) have to make to the shareholders of a company in case the acquisition is in excess of 25 per cent stake, as per Sebi regulations.
The offer price for the open offer has been fixed at ₹403.22 per share.
Pluto Investments S.a r.l alongside Salisbury Investments, Carlyle Asia Partners IV S C Sp, Carlyle Asia Partners V, S C Sp, Quality Investment Holdings and CAP IV AIV Mauritius — collectively the PACs — have made the open offer to the shareholders for acquisition of up to 70,793,011 equity shares of PNB Housing Finance.
Salisbury Investments is the family investment vehicle of Aditya Puri, ex-CEO of HDFC Bank, who is also a senior advisor for Carlyle in Asia.
On May 31, the board of directors of PNB Housing Finance cleared the proposal for ₹4,000 crore capital infusion into the company in lieu of preference shares and warrants to the PACs.
Under the proposed deal, ₹3,200 crore is to be raised through equity shares and ₹800 crore by issuance of warrants.
Notably, PNB Housing Finance has not raised any equity capital in the past three years, except equity shares issued under the Employee Stock Option Plan.
Earlier in February this year, the Reserve Bank had rejected PNB’s proposal for a capital infusion into its subsidiary PNB Housing.
An extraordinary general meeting (EGM) of the shareholders of the housing financier is slated for June 22 to seek their approval for allotment of shares and warrants to the proposed investors, among others.
HSBC Securities and Capital Markets (India) is managing the open offer on behalf of the acquirers. The public announcement about the open offer was made on May 31, 2021.
The last date of the public announcement for completing the offer is June 28 and the last date for receipt of comments from markets regulator Sebi on the draft letter of offer (in case the regulator seeks additional information) is July 5, 2021.
The offer opening date is fixed at July 22 while the closing date is August 4, 2021, as per the draft letter of offer.
Last week, proxy advisory firm SES raised concerns about the proposed preferential issue and said that it will change the control of PNB Housing Finance — from PNB being the sole promoter of the company to a joint control holder with Carlyle Group.
With this, PNB’s stake in the company will come down to 20.28 per cent from the existing 32.64 per cent, while that of Carlyle will rise to 50.16 per cent from 32.21 per cent.
Carlyle will become the major shareholder and promoter along with its PACs, including Puri, SES said in a report.
It also said the proposed deal was an ‘unfair transaction’ which is against public shareholders as well as the promoter bank PNB.
SES further said the open offer is a mere formality given the present market price. “It is highly unlikely that any shareholder would tender their shares,’ said the report.
