Fincare Small Finance Bank has resubmitted its DRHP to market regulator Securities and Exchange Board of India (SEBI) in preparation for its Initial Public Offering (IPO). This new file comes after the lender’s one-year clearance from the capital markets regulator to launch an IPO expired last month. If a company fails to launch an IPO within a year, it must resubmit the prospectus to the regulator.
According to a new Draft Red Herring Prospectus (DRHP) filed on Saturday, Fincare Small Finance Bank’s IPO will include a fresh offering of up to 625 crore worth of equity shares and an Offer For Sale (OFS) of up to 1.7 crore equity shares by a promoter and investors.
Promoters Fincare Business Services Ltd and investors Wagner, True North Fund V LLP, Indium IV (Mauritius) Holdings Ltd, Omega TC Holdings PTE Ltd, Leapfrog Rural Inclusion (India) Ltd are selling shares in the OFS.
Investors selling shares in OFS include Kotak Mahindra Life Insurance Company, Edelweiss Tokio Life Insurance Company, Bharti AXA Life Insurance Company, Silver Leaf Oak (Mauritius) Ltd, Tata Capital Financial Services Ltd, and Edelweiss General Insurance Company.
The proceeds from the new share offering will be utilised to supplement the bank’s tier-1 capital base in order to satisfy future capital requirements. Fincare Small Finance Bank filed draught papers with Sebi in May 2021 to fund Rs. 1,330 crore through an IPO. The lender acquired Sebi approval to launch the IPO in July of last year but did not do so.
Motilal Oswal Private Equity (PE) stated in May of last year that it had acquired a minority share in Fincare Small Finance Bank through a secondary acquisition valued around Rs185 crore ($25 million). Motilal PE managed and advised the India Business Excellence Fund-III, which made the investment.
Bengaluru-based Fincare Small Finance Bank is a “digital-first” SFB with a focus on unbanked and under-banked customers, especially in rural and semi-urban areas. It was one of the 10 applicants to receive the Reserve Bank of India (RBI) approval to convert from a microfinance institution into an SFB under the guidelines for this new class of banks issued by the central bank in 2015.