Kotak tries to raise $2 bn amid a pandemic

Mumbai: Kotak Mahindra Bank is set to launch a share sale to institutional investors aimed at raising as much as $2 billion in multiple tranches as the private sector lender looks to dilute the promoter’s shareholding to comply with regulatory norms and raise capital.The private sector lender will first launch a 7,500 crore institutional share sale this week of fresh equity, said people with knowledge of the matter.Promoter Uday Kotak will then sell about 57 million shares to public investors, a holding valued at about 6,600 crore at current prices.75990174The transaction comes at a time when banks require capital in order to fend off worries about bad loans escalating in the wake of the Covid-19 pandemic.The qualified institutional placement (QIP) could begin early this week, said people with knowledge of the matter.“We are considering its launch within a day or two as we are experiencing positive investor response,” said one of the persons involved in the exercise. The arrangers have been conducting road shows in the past few days.“Uday Kotak's share sale may get postponed and will do a launch post the QIP issuance,” said another person.

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