The Hindu Business Line : ICICI Bank readying Rs 8,750-cr follow-on public issue

The issue
5% reserved for existing shareholders
Shortfall in retail subscriptions may be used to meet demand from public
Fund will be used for future growth needs

Mumbai June 13 ICICI Bank will raise Rs 8,750 crore in the domestic stock market through a follow-on public issue.

In a notice to the Bombay Stock Exchange, the bank said it would issue equity shares of Rs 10 each for cash at a price to be determined by book building (including a share premium per equity share) aggregating to Rs 8,750 crore.

The bank has decided to reserve five per cent in the present public offer for existing shareholders holding equity shares of the bank not exceeding Rs 1 lakh in market value as on June 13.

If retail shareholders do not pick up their full entitlement, the resultant shortfall will be utilised to meet any excess subscriptions from the portion earmarked for the general public and thereafter from any of the other categories. The allocation will be decided in consultation with the book running lead manager and co-book running lead manager, said the bank, in its red herring prospectus filed with SEBI last month.

The bank will announce other details relating to the issue, such as the price band for the follow-on public offer, in due course, the BSE announcement said.

ICICI Bank plans to raise Rs 20,125 crore through a domestic follow-on public issue as well as an American depository shares issue.

This capital raising exercise is to augment the bank's capital base to meet its future capital adequacy requirements arising out of growth in business and for other general corporate purposes.

"Additional capital is required for future asset growth and compliance with regulatory requirements," said the bank. The bank's total capital adequacy ratio was at 11.7 per cent as on March 31, 2007 including 7.4 per cent of Tier-I capital and 4.3 per cent of Tier-2 capital.

ICICI Bank's scrip closed at Rs 912.90 against the previous close of Rs 919.05 on the BSE.