PB Fintech is said to revive $1 billion fundraise after outreach
PB Fintech is expected to revive a major fundraising plan that had been paused over shareholder pushback, after completing consultations with existing shareholders and prospective investors, according to people familiar with the matter.
The Policybazaar parent is likely to return with a proposal to raise as much as $1 billion through a qualified institutional placement once the investor outreach is concluded and market conditions stabilize, according to the people, who asked not to be identified because the information is private.
The company has appointed Kotak Mahindra Capital Co., IIFL Capital Services Ltd., and local units of HSBC Holdings Plc and Citigroup Inc. as advisers for the transaction, the people said.
PB Fintech on Thursday cancelled a board meeting that had been scheduled to consider the institutional placement aimed at supporting potential global acquisitions. Some shareholders had raised concerns about the timing of the fundraise after a decline in the company’s share price and questioned the strategic rationale and capital allocation priorities, the people said.
PB Fintech and the banks didn’t respond to requests for comment.
The stock has declined 16% so far this year, compared with a gain of about 9% in the benchmark Nifty 50 index.
Volatility in PB Fintech’s stock is not new, particularly over capital allocation plans. Last March, the stock fell after the company said it plans to infuse 6.96 billion rupees ($77 million) into its subsidiary, PB Healthcare Services. The Shares slid as much as 10% in September after several brokerages flagged concerns over the company’s plans to expand into the healthcare industry. PB Fintech later clarified that its healthcare foray would be housed in a separate entity, with the company acting only as a minority investor.
“There have been concerns around capital allocation following the earlier hospital venture, and now with expansion into international markets,” Suresh Ganapathy, managing director and head of financial services research at Macquarie Capital, wrote in a note early this week.
The Policybazaar parent is likely to return with a proposal to raise as much as $1 billion through a qualified institutional placement once the investor outreach is concluded and market conditions stabilize, according to the people, who asked not to be identified because the information is private.
The company has appointed Kotak Mahindra Capital Co., IIFL Capital Services Ltd., and local units of HSBC Holdings Plc and Citigroup Inc. as advisers for the transaction, the people said.
PB Fintech on Thursday cancelled a board meeting that had been scheduled to consider the institutional placement aimed at supporting potential global acquisitions. Some shareholders had raised concerns about the timing of the fundraise after a decline in the company’s share price and questioned the strategic rationale and capital allocation priorities, the people said.
PB Fintech and the banks didn’t respond to requests for comment.
The stock has declined 16% so far this year, compared with a gain of about 9% in the benchmark Nifty 50 index.
Volatility in PB Fintech’s stock is not new, particularly over capital allocation plans. Last March, the stock fell after the company said it plans to infuse 6.96 billion rupees ($77 million) into its subsidiary, PB Healthcare Services. The Shares slid as much as 10% in September after several brokerages flagged concerns over the company’s plans to expand into the healthcare industry. PB Fintech later clarified that its healthcare foray would be housed in a separate entity, with the company acting only as a minority investor.
“There have been concerns around capital allocation following the earlier hospital venture, and now with expansion into international markets,” Suresh Ganapathy, managing director and head of financial services research at Macquarie Capital, wrote in a note early this week.
Next Story