Edelweiss Financial raises Rs 1,500 crore via QIP

Mumbai: Edelweiss Financial Services has raised Rs 1,500 crore by selling fresh shares to institutional investors on Thursday. The company sold 5.35 crore shares to foreign and domestic investors in a Qualified Institutional Placement at Rs 280 a piece, said a top official familiar with the matter. The stock closed 0.9 per cent lower at Rs 279.95 on Thursday.

This is the first share sale by Edelweiss Financial since its listing 10 years ago. Following the fund raising, the equity capital of the company is expected to go up by 7 per cent.

The funds raised through QIPs would be utilised for the growth of retail credit and distressed credit, said a company official on condition of anonymity.

Nearly two-thirds of the QIP has been subscribed by Caisse de Dépôt et Placement du Québec (CDPQ), the second-largest pension fund in Canada, and three domestic mutual funds— HDFC, Reliance and Kotak, the official said.

Last year, CDPQ signed an agreement with Edelweiss Financial to invest Rs 5,000 crore in stressed assets and specialised corporate credit in India, over the next four years. CDPQ also acquired a 20 per cent equity stake in Edelweiss Asset Reconstruction.

Other investors in the QIP include existing shareholders like Amansa Holdings and Scandinavian Insurance. While Amansa holds 1.39 per cent in Edelweiss Financial, Scandinavian held 4 per cent stake in Edelweiss Asset Reconstruction.

Currently promoter Rashesh Shah and his family hold 35.95 per cent stake in the company.