Carlyle and its affiliated funds will invest up to Rs 3,185 crore in the housing finance company through a preferential allotment of equity shares and warrants at a price of Rs 390 per share, a discount of nearly 11 per cent to Friday’s closing price.
Crucially, one of the most admired bankers in India Aditya Puri will also be an investor in the housing finance company, PNB Housing said. Aditya Puri’s Salisbury Investments will be participating in the capital-raising drive along with existing private equity investors Ares SSG and General Atlantic.
Carlyle alongwith Salisbury Investments will make an open offer for further 26 per cent stake in the housing finance company at a floor price of Rs 403 per share.
“I believe PNB Housing Finance with its enhanced capital base is very well positioned to meet the growing demand in its areas of operation. I look forward to helping the company in this exciting journey,” Aditya Puri, who will be appointed to the company’s board as nominee of Carlyle Group, said in a statement.
PNB Housing Finance has been on the hunt for capital raising and to reduce the promoter’s stake in the business. Punjab National Bank will continue to function in the capacity of promoter and will be the key shareholder of the housing finance company.
The key objective of raising capital is to augment capital adequacy, reduce gearing and accelerate growth with a focus on retail housing, including self-employed and affordable housing loans such as the Unnati segment, the company said.
Assuming full capital infusion (including warrants) and no other change to the March 31, 2021 financials, the capital adequacy ratio of the company would increase from 18.7 per cent to over 28 per cent and gearing will decline from 6.7 times to less than 5 times.
“This fund raise, and Carlyle’s continued support, puts us in a strong position to benefit from the
growing opportunities in the housing finance sector including in the affordable housing loans and self-employed segments,” said Managing Director and Chief Executive Officer Hardayal Prasad.
Dalal Street bounced on the announcement as Carlyle’s entry and Aditya Puri’s guidance may do wonders for the housing finance company in a consolidating sector.
While the fundraising does put PNB Housing in a sweet spot compared to rivals, it is the entry of Aditya Puri in the company’s board and as an investor which will excite the market most. Puri’s track record as the head of HDFC Bank for nearly three decades made him the most sought after banker in the world.
Analysts suggested that Puri’s backing could transform PNB Housing’s corporate culture and growth focus and could help the company take on Puri’s former masters at Housing Development Finance Corp.
Shares of the housing finance company jumped 20 per cent to Rs. 525.65 on the National Stock Exchange.
