HDFC Proposes Preferential
Andhra Pradesh ~ India ~ International ~ City ~ Entertainment ~ Business ~ Sports ~ Technology ~ Health ~ Features
2010 Commonwealth Games ~ 2010 Nobel Prizes ~ Sachin Tendulkar ~ Rajasthan Royals ~ Kings XI Punjab ~ Sushil Kumar ~ Deepika Kumari ~ Somdev Devvarman ~ HR Bhardwaj
Home / India News / 2007 / May / May 25, 2007
HDFC Proposes Preferential Issue of Rs 3,114 crores
HDFC Limited

India’s leading Women are Rewarded for their Outstanding Endeavours at the WIL India Awards

Indian women rewarded for outstanding endeavour at WIL India Awards

naseba Announces the much Anticipated Shortlisted Nominees for the WIL India Awards 2010

More on HDFC Limited

Top News

144 Section in Hyderabad ahead of Ayodhya verdict

Manmohan Singh to campaign in Bihar today

FBI failed to act on Headley's wife's terror link expose 3 yrs before Mumbai attacks

Craven's horror flicks 'were inspired by real stories'

RBI will intervene if inflows turn lumpy: Subbarao

Enforcement Directorate issues 'Look Out Circular' against Lalit Modi

Now, laser technology that destroys tumours using heat

Waist size, not BMI can foretell cardiovascular risk in children

HDFC Proposes Preferential Issue of Rs 3,114 crores

Mumbai, Maharashtra, India



Preferential Allotment of Equity Shares

The Board of Directors of Housing Development Finance Corporation Limited (HDFC) has at its meeting held on Friday, May 25, 2007, recommended the issue of 1.8 crore equity shares of Rs. 10 each on a preferential basis to a select group of investors. This represents 7.11% of the total issued and paid-up capital of the Corporation.

The Carlyle Group through CMP Asia Limited will subscribe to 1.525 crore shares and Citigroup Strategic Holdings Mauritius Limited will subscribe to the balance of this issue. The shares to be issued on a preferential basis would be at a price of Rs. 1,730 per equity share of Rs. 10 each. This price represents a 6.9% premium over the average weekly high and low closing share price of HDFC during the past six months period. Post the issue, Citigroup will maintain its holding at 12.3% and The Carlyle Group will hold 5.6% of the equity of the Corporation.

The aggregate amount to be raised by the Corporation through the proposed preferential issue would be Rs. 3,114 crores. The preferential allotment is in accordance with Chapter XIII of the Securities and Exchange Board of India (Disclosure and Investor Protection) Guidelines, 2000 and is subject to shareholder approval at the ensuing Annual General Meeting to be held on June 27, 2007.

HDFC's loan approvals have grown consistently at 30% on a 10-year compounded annual growth rate basis. In order to fund the growth of the mortgage business and to fund the rapid expansion of HDFC's associate and subsidiary companies, namely HDFC Bank Limited (HDFC Bank) and HDFC Standard Life Insurance Company Limited (HDFC-SL), the Corporation needs to raise additional capital.

HDFC currently holds 21.56% of HDFC Bank. In order that HDFC as a promoter retains its shareholding in HDFC Bank at approximately the current level, the Board of HDFC Bank, subject to the requisite approvals of the Reserve Bank of India and its shareholders, has made a preferential offer to HDFC at a price of Rs. 1,023.49 per share. This investment will ensure that HDFC maintains its shareholding in HDFC Bank at 22% post HDFC Bank's proposed increase in its share capital.

HDFC-SL has recorded encouraging growth over the last few years. HDFC's shareholding in HDFC-SL is currently at 81.9%. Over the next couple of years, HDFC would have to continue to contribute its share of equity to HDFC-SL to fund its growth. Investment in the equity of HDFC-SL has a direct impact on HDFC's capital ratios.

Thus the preferential allotment of shares by HDFC will ensure that it will meet its commitments to its subsidiary and associate companies without impacting its core mortgage business.

maheshs@hdfcindia.com

Source: Housing Development Finance Corporation Limited (Business Wire India)

Press release presented here is sourced from the Source mentioned above and is provided on as-is basis. Please contact the Company / Source directly for any further information in regard to this release. This website will be unable to assist you in regard to the accuracy or correctness of information in this release.

Suggested pages for your additional reading
AndhraNews.net on Facebook






© 2000-2017 AndhraNews.net. All Rights Reserved and are of their respective owners.
Disclaimer, Terms of Service & Privacy Policy | Contact Us