ADB to take 10% stake of HNB for $ 50 m

Thursday, 1 September 2016 00:02 - - {{hitsCtrl.values.hits}}

Hatton National Bank (HNB) yesterday announced a $ 50 million issue of shares by private placement to Manila-based Asian Development Bank (ADB) to strengthen their balance sheet and support the overall business growth of the company.

In a stock exchange filing, HNB informed the Colombo Stock Exchange that it had taken the decision at a meeting on Wednesday to issue up to $ 50 million or ordinary voting shares up to 9.9% of the total ordinary voting shares of the bank.

However, the decision is subject to approval at an Extraordinary General Meeting (EGM).

HNB named the ADB as a “strategic investor” and the share price would be the average price of HNB shares traded in the 30 days immediately preceding the EGM or would be priced at Rs. 220 if the average price is more than Rs. 220 or Rs. 190 if the average price is less than Rs. 190.

HNB on Wednesday closed at Rs. 225.

“The Board of Directors has opined that the aforesaid consideration for which the ordinary voting shares of the bank are to be issued to ADB through a private placement as aforementioned is fair and reasonable to the bank and to all existing shareholders,” the filing said.