Bain Capital readies a $1 billion bet on Axis Bank

MUMBAI: Bain Capital is in advanced talks with Axis Bank to invest between $750 million and $1 billion (Rs 4,800-6,400 crore), in what could be one of the largest private equity investments in the Indian banking sector.

India’s third-biggest private lender is in talks to raise money amidst worsening asset quality and regulatory glare.

Bain’s proposed investment will come as a primary issuance of shares through a preferential allotment that will allow the PE fund to own up to 5% of Axis.

However, some of the sources mentioned above said there could be a subsequent secondary deal as well, through which the Bain may grab another 5% stake from existing investors. This may increase its exposure to nearly 10%, taking the total investment to close to $1.5 billion. The deal will have to be approved by the Reserve Bank of India.

The transaction will help Axis meet capital requirements for the medium term as competition intensifies in Indian banking. JPMorgan is working with Axis for the transaction, which is expected to be concluded within a few weeks, sources said.

Axis Bank