Yes Bank is yet again seeing investor attention as Japan's Mitsubishi UFJ Financial Group (MUFG), the second-largest bank holding company globally, has re-entered the bid to acquire a controlling stake in the banking firm.
As per a report by the Economic Times, this development comes after the rejection of MUFG's $2 billion investment proposal for HDB Financial (a non-banking finance subsidiary of HDFC Bank), by the lender's board last month.
Yes Bank has been in search of a new owner for the past four years after a central bank-led rescue. Earlier this year, MUFG was among the several potential buyers considered for the Yes Bank deal but withdrew after a short evaluation period. However, after the collapse of discussions with HDB, MUFG is reportedly re-engaging its interest in Yes Bank.
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The private bank currently has a market value of Rs 68,586.98 crore. If the deal comes to fruition, the sell-off of 51 per cent stake would result in the largest merger and acquisition in India's banking sector.
As of now, the lender has already presented a a non-binding proposal to acquire State Bank of India's 23.99 per cent stake in Yes Bank, which would activate an open offer for an additional 26 per cent stake. As per the report, MUFG has also begun comprehensive due diligence on Yes Bank, with a timeframe of four to six weeks to finalise this process.
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Not the first time this year
This is not the first time this year that any financial entity has shown interest in the private bank. Japan's Mizuho Bank and Emirates NBD have also been reported as potential bidders for a stake in Yes Bank.
However, Mizuho had withdrawn from the competition, as it aimed to make a financial investment by acquiring a 20-24 per cent stake in Yes Bank without seeking board representation. Mizuho also wanted to avoid activating an open offer for an additional 26 per cent stake in the bank, which is mandated by Indian law for holdings in a listed company.
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