LVB to raise Rs 188.16 via preferential shares sale to Indiabulls Housing Finance

Lakshmi Vilas Bank (LVB) Monday said it proposes to raise Rs 188.16 crore by allotting 4.99 per cent of its shares at Rs 112 apiece on a preferential basis to Indiabulls Housing Finance Ltd.

Earlier this month, the private sector lender had announced its merger with Indiabulls Housing Finance Ltd (IBHL) in a share-swap deal with an intent to create a combined entity with larger capital base and wider geographical reach.

The board of LVB has approved the merger with IBHL in which shareholders of the bank will get 14 shares of IBHL for every 100 shares they hold.

The bank proposes to issue 1.68 crore shares on a preferential basis to IBHL.

"...the board at its meeting held on April 22, 2019, has, subject to the approval of the shareholders of the bank, approved Rs 112 per equity share as the actual price at which the equity shares will be issued and allotted to the proposed allottee on a preferential basis," the bank said in a filing to stock exchanges.

The Reserve Bank (RBI) is yet to examine the merger proposal of the bank and the IBHL, a non-banking finance company.

LVB shares closed at Rs 79.55 a piece on BSE, down 4.56 per cent while that of IBHL traded last at Rs 733 per share, down 8.4 per cent.