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Business News/ Companies / News/  SKS Trust hikes stake in SKS Microfinance
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SKS Trust hikes stake in SKS Microfinance

SKS Trust’s total stake in the company rises to 12.6%

SKS founder Vikram Akula sold 906,724 shares on Tuesday. Photo: Hemant Mishra/ MInt (Hemant Mishra/ MInt)Premium
SKS founder Vikram Akula sold 906,724 shares on Tuesday. Photo: Hemant Mishra/ MInt
(Hemant Mishra/ MInt)

Hyderabad/Mumbai: SKS Trust Advisors Pvt. Ltd said on Tuesday that it had become the single largest shareholder in India’s only publicly traded micro lender SKS Microfinance Ltd after it bought an additional 2.69% in the company on the stock exchanges.

SKS Trust acquired 1.02 million shares in the name of SKS Mutual Benefit Trust Medak at a price of 130.8 per share on Tuesday, according to a company filing to the stock exchanges.

Also on Tuesday, Vikram Akula, the founder and former executive chairman of SKS, and Sequoia Capital India Growth Investments, sold 906,724 and 1.5 million shares, respectively, according to data from the BSE. The buyers are not known.

With the latest purchase, SKS Trust’s total stake in the company rose to 12.6%. Sandstone Investment Partners was the largest shareholder in SKS with 11.53% stake, according to the company’s annual report of FY12.

Shares of SKS Microfinance gained 11.9% to close at 132.30 on BSE, while the exchange’s benchmark Sensex fell by 3.45% to 18,234.66 points.

SKS Trust is the sole trustee of five mutual benefit trusts (MBT) whose beneficiaries are self-help groups whose members borrowed from SKS Microfinance. The trusts are the original promoter shareholders of SKS Microfinance Ltd. The MBTs were formed in 2003 with the objective of promoting and enhancing the social and economic welfare of groups of poor women.

“We believe the stock of SKS Microfinance Ltd at current prices offers a good investment value to the Trusts from a long-term perspective," said Biksham Gujja, chairperson and director of SKS Trust.

Gujja, an expert in water management and food security, turned into an entrepreneur by setting up a social enterprise called AgSri Agricultural Services Pvt. Ltd to promote sustainable agriculture and water resources management.

“The enhanced stake, apart from the investment value, will empower the Trust to better fulfil its responsibilities as the original promoter and help SKS Microfinance achieve its original vision and strategy," Gujja said. SKS Trust said the funding for the share purchase came from the internal financial resources of the trust itself.

The spokesperson for SKS Microfinance couldn’t be reached for a comment.

SKS Trust’s latest accumulation of SKS Microfinance shares assumes significance as it has been demanding to be inducted into the board of SKS.

The trust said it will continue to press the demand for a board seat in SKS.

“The manner in which they are (SKS Trust) systematically acquiring shares in the open market, indicates it’s a hostile move," said an analyst, who did not want be named citing his company’s policy.

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Published: 04 Sep 2013, 01:05 AM IST
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