Emirates NBD to buy majority stake in India’s RBL Bank – report

Emirates NBD Bank is reportedly close to finalising a deal to acquire a major share of RBL Bank, an Indian-based private sector bank.

Sources suggest that the transaction could see Emirates NBD taking over up to a 60% stake in RBL Bank, with an estimated value of approximately $3bn, as per information disclosed by the NDTV Profit.

Details of the proposed acquisition indicate that Emirates NBD would conduct the transaction through its Indian subsidiary, which is expected to be integrated with RBL Bank post-purchase.

Initial steps would involve the acquisition of a 26% stake from current institutional investors, followed by a subsequent public offer to acquire an additional 25%, local financial media outlet Mint reported.

Regulatory constraints from the Reserve Bank of India (RBI) are likely to limit Emirates NBD's voting rights to 26%, despite the larger shareholding.

JPMorgan, a leading international investment bank, is providing advisory services to Emirates NBD for this deal.

The Mint quoted a source as saying: “Emirates NBD Group is likely to acquire around 26% stake in RBL Bank from institutional investors, and then make an open offer for another 25%."

The UAE government owns a 56% stake in Emirates NBD.

This development follows the RBI's in-principle approval for Emirates NBD Bank to form a subsidiary in India earlier this year.

Emirates NBD operates three branches in India, situated in Chennai, Gurugram, and Mumbai, and the RBI's approval allows for the conversion of these branches into a wholly-owned subsidiary.

Recently, Sumitomo Mitsui Banking Corporation (SMBC) agreed to increase its investment in India’s YES Bank by acquiring an additional 4.2% stake from CA Basque Investments, an affiliate of The Carlyle Group.

This agreement comes after SMBC's initial acquisition of a 20% stake in YES Bank.

"Emirates NBD to buy majority stake in India’s RBL Bank – report " was originally created and published by Retail Banker International, a GlobalData owned brand.

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