Equitas Small Finance Bank Ltd. (ESFBL) will take steps to get listed through an initial public offering (IPO) by March 2020, said a top official.
“We will soon start the exercise of filing red herring prospectus,” said P.N. Vasudevan, MD and CEO, ESFBL.
“The shares will be listed by March 2020 under normal circumstances,” he said. Mr. Vasudevan said they planned the IPO since the draft scheme of arrangement between Equitas Holdings Limited (EHL) and ESFBL was returned by the Securities and Exchange Board of India.
While granting an in-principle approval for the bank, the RBI had asked ESFBL to get the entity listed within three years i.e. by September 4, 2019 and reduce promoters’ stake to 40%.
As EHL was a listed company and ESFBL, its wholly owned subsidiary, it approached the SEBI with a reverse merger proposal.
Since, the regulator did not approve the proposal, EHL and ESFBL boards had approved a scheme of arrangement wherein ESFBL would capitalise its free reserves and issue shares to the shareholders of EHL without cash consideration.
As the deadline for listing was nearing, ESFBL sought an extension of the same. On September 4, the RBI declined to extend the same.
“Since, SEBI had rejected the scheme of arrangement, we will be taking immediate steps for an IPO,” the MD said.
