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Business News/ Companies / IDFC share sale this week to pare FII holding
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IDFC share sale this week to pare FII holding

The firm will be issuing fresh shares worth `1,000 crore

The share sale is likely to start on Wednesday or Thursday.Premium
The share sale is likely to start on Wednesday or Thursday.

Mumbai: Infrastructure financier IDFC Ltd will be starting its institutional share sale programme during the week in order to lower its foreign institutional investor (FII) holding to 49%, two people close to the development said on condition of anonymity. The firm will be issuing fresh shares worth 1,000 crore.

Reserve Bank of India guidelines require IDFC to bring down its FII holding below 50% in order to operate its bank. Currently, FIIs hold a 51.81% stake in the firm.

Vikram Limaye, chief executive at IDFC, confirmed the development. “The share sale will take place this week. We, however, will decide in our internal meeting tomorrow (Wednesday) if we want to do a follow-on public offer or a qualified institutional placement. The decision will depend on the demand for the issue," Limaye said.

The share sale is likely to start on Wednesday or Thursday. IDFC will bring down the FII holding to less than 50%. We are still finalizing on the dates," said one of the bankers directly involved in the transaction.

Credit Suisse Group AG, ICICI Securities Ltd, JM Financial Ltd and IDFC Securities Ltd have been appointed to manage the share sale.

IDFC will be starting its banking operation by October 2015 under the name IDFC Bank. The firm has been building the leadership team for its bank. In August, it appointed Ravi Shankar from Fullerton India Credit Co. Ltd to head the bank’s rural banking initiative.

In July, the firm announced the appointment of Pavan Pal Kaushal, earlier with consulting firm EY, as the chief risk officer for the bank. Avtar Monga, formerly with Bank of America-Merill Lynch, was brought in to head operations and technology. Ajay Mahajan, formerly with Yes Bank Ltd, will be leading the markets and institutional banking team.

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Published: 09 Sep 2014, 04:52 PM IST
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