Ahead of IPO, Tamilnad Mercantile Bank collects Rs 363 cr from anchor investors

Private sector lender Tamilnad Mercantile Bank on Friday said it has mobilised a little over Rs 363 crore from anchor investors days before its Initial Public Offering (IPO).

The company has decided to allocate 71.28 lakh equity shares to anchor investors at Rs 510 apiece, aggregating the transaction size to Rs 363.53 crore, according to a circular uploaded on the BSE website.

Societe Generale, Nomura Singapore, Bajaj Allianz Life Insurance Company, Max Life Insurance Company, Kotak Mahindra Life Insurance Company and Moneyewise Financial Services are among the anchor investors.

The IPO is a fresh issue of 1.58 crore equity shares. The issue, with a price band of Rs 500-525 per share, will open for public subscription on September 5 and conclude on September 7.

At the upper end of the price band, the bank is expected to mobilise Rs 831.6 crore through its IPO.

The Tuticorin-based bank proposes to utilise the proceeds from the issue for augmenting its Tier-I capital base to meet future capital requirements.

Tamilnad Mercantile Bank is one of the oldest private sector banks in the country with a history of almost 100 years. It offers a wide range of banking and financial services primarily to  Micro, Small and Medium Enterprises (MSME), agricultural and retail customers.

As of March 2022, the bank has 509 branches, of which, 106 branches are in rural, 247 in semi-urban, 80 in urban and 76 in metropolitan centres. It had a customer base of around 5.08 million as of March 2022. Of which, nearly 80 per cent comprised customers who were associated with the bank for more than five years.

The company said that 75 per cent of the issue has been reserved for qualified institutional investors, 15 per cent for the non-institutional investors and the remaining 10 per cent for retail investors.

Axis Capital Limited, Motilal Oswal Investment Advisors Limited and SBI Capital Markets Limited are the book running lead managers to the public issue. The equity shares are proposed to be listed on BSE and NSE.