Axis Bank, the third largest private sector lender, on Friday said it proposes to raise equity and equity-linked capital of Rs 11,626 crore from a set of marquee investors including Life Insurance Corporation of India and Bain Capital Private Equity, among others.

Entitites affiliated with Bain Capital propose to invest Rs 6,854 crore and LIC proposes to invest Rs 1,583 crore, the bank said in a regulatory filing after the board approved the proposal.

The bank proposes to raise Rs 9,063 crore through issuance of equity and the remaining Rs 2,563 crore through issue of warrants. The bank has received approval for the capital raise from its Board of Directors on Friday.

Axis  Bank proposes to issue 172.63 million equity shares on preferential basis at a price of Rs 525 per share at a premium of 2.4% to the Sebi floor price as of the relevant date and 45.35 million warrants convertible into equity shares at a price of Rs 565 per share at a premium of 10.2% to the Sebi floor price as of the relevant date, adding Rs 43.6 crore in the paid up capital of the bank. This would entail a dilution of 8.23% for existing shareholders.

The capital raised will bolster the capital adequacy ratio of the bank, thereby providing growth capital for the core business of the bank and its subsidiaries.

Once approved, this would be one of the largest private equity investments in the Indian banking sector. Axis Bank was advised exclusively by Axis Capital Ltd and Bain Capital was advised by JP Morgan on this transaction. Legal advisors to Axis Bank were Shardul Amarchand Mangaldas and Bain Capital was advised by AZB & Partners, the bank said in the filing to the BSE.

"Axis Bank is well positioned to participate in the credit growth trajectory in the country. This capitalisation of Axis Bank and the interest shown by marquee investors, positions us for even greater strength," Sanjiv Mishra, Chairman, Axis Bank said.