Abu Dhabi Bank Eyes Major Stake in Yes Bank Amid Buyout Speculations

An Abu Dhabi-based bank is likely to buy a substantial stake in an Indian bank, UAE Ambassador to India Abdulnasser Alshali told CNBC TV-18, fueling speculation that Yes Bank is a target.

The ambassador did not disclose the parties involved, citing ‘market sensitivity’.

He said the investment is worth several billion dollars. However, the ambassador said some outstanding issues should be resolved first.

“Some things have to be sorted out for it to continue,” he told the channel. He, however, expressed hope that the issues would be resolved.

In July, reports emerged that First Abu Dhabi Bank was among those interested in buying a $5 billion stake in Yes Bank.

Bloomberg reports that the lender is considering buying a 51 percent stake in Yes Bank. The stake sale has also drawn interest from Mitsubishi UFJ Financial Group and Sumitomo Mitsui Financial Group.

Abu Dhabi Bank initially said it was not considering a possible stake in Yes Bank.

There are also reports that the Reserve Bank of India (RBI) has approved the sale of 51 percent stake in the bank. This was denied by the private sector loan company.

“The Bank wishes to clarify that the contents of the said article are factually incorrect and purely speculative in nature. “The RBI has not given any approval in principle as stated in the article and the company is voluntarily issuing this clarification to remove the baseless media article,” Yes Bank had said in a regulatory filing.

Yes Bank could be sold for around $10 billion, the report said, adding that the lender has appointed Citigroup to select a suitable bidder.

A clutch bank has a stake in Yes Bank. State Bank of India holds a 23.99 percent stake, while HDFC Bank, ICICI, Axis and Kotak Mahindra Bank hold smaller stakes.

Apart from these lenders, Life Insurance Corporation held 3.98 percent for the quarter ended June 30, 2024. Yes Bank reported 46.7 percent growth in net profit at ₹502 crore for the April-June 2024 quarter.