IIHL approves capital raising of up to $1.5 bn for strategic objectives

IndusInd International Holdings Limited (IIHL), the promoter of IndusInd Bank, is set to expand its business horizon in India and other countries, in the Banking Finance and Insurance (BSFI) sector, according to a press release from Induslnd.

Ashok P Hinduja, President of the IIHL, said that this plan will help expand the IIHL’s business and that the IIHL’s aspirations will not be constrained by capital as raising capital for the IIHL is not an issue.

IIHL’s Board of Directors approved a capital increase of up to $1.5 billion to achieve its two strategic objectives. The first objective of the capital increase is to increase its shareholding in IndusInd Bank from the 15 per cent to the proposed 26 per cent, as they are eligible to increase their shareholding by following the prescribed procedure subject to ‘proper and proper’ by the Reserve Bank of India (RBI).

The second objective is towards equity participation in the acquisition of Reliance Capital. As previously reported, IIHL was the sole applicant for resolution with an offer amount of Rs 9,650 crore in the process being run under the Insolvency and Bankruptcy Act (IBC) of Reliance Capital Limited.

IIHL is likely to list by 2024 and this would also grant trading options to its shareholders who have been with the company for more than three decades.

The IIHL’s board of directors recommended a special interim dividend of 10 percent to reward its shareholders. The Board of Directors also approved a buyback plan to partially dilute its original shareholders at $20.

The company’s vision is to be a global financial services institution committed to excellence in international orientation, innovation, speed and strict compliance with the principles of good corporate governance, according to the press release.