Abu Dhabi’s First Abu Dhabi Bank PJSC is reportedly considering a bid for a significant stake in Yes Bank Ltd, amounting to approximately $5 billion, sources familiar with the matter disclosed to Bloomberg. The potential acquisition could involve up to a 51% ownership in the Mumbai-based lender.
Alongside First Abu Dhabi Bank, Japanese financial giants Mitsubishi UFJ Financial Group Inc. and Sumitomo Mitsui Financial Group Inc. have also shown preliminary interest in the stake sale, as reported by Bloomberg.
Yes Bank’s shares have seen a 16% increase in value since the beginning of the year, valuing the bank at around $9.4 billion.
Recently, Yes Bank refuted claims circulating in the media that the Reserve Bank of India (RBI) had approved the sale of a 51% stake in the bank. In a statement to the stock exchange, Yes Bank dismissed these reports as “factually incorrect and purely speculative.”
Earlier reports had suggested that the RBI had given its nod for a stake purchase in the bank by a new promoter, which raised market speculation. However, Yes Bank clarified that no such approval had been granted by the RBI, emphasizing that the article was baseless.
Despite the refutation, Yes Bank and its major stakeholders have received preliminary clearance from the central bank for potential changes in ownership. The RBI typically restricts promoter holdings in domestic banks to 26%, making any increase subject to regulatory scrutiny and approval.
The potential acquisition of a majority stake in Yes Bank could significantly impact India’s banking industry, potentially valuing the bank at over $10 billion post-sale, which would mark it as one of the largest acquisitions in the sector.
The development underscores growing international interest in India’s banking sector and the strategic moves by foreign financial institutions to expand their footprint in the country.
