ING raises $175 mn from Kotak stake sale: sources

ING raises $175 mn from Kotak stake sale: sources

Mumbai: Dutch financial services group ING raised $175 million by selling its entire 3.1% stake in Kotak Mahindra Bank, two sources with direct knowledge of the deal said on Thursday.

The sale of 10.8 million shares in stock market block deals was done at Rs750 a share, the sources told Reuters. Another source had told Reuters on Wednesday that shares would be sold in the range of Rs730-750 each.

The final sale price represent a 4.2% discount to Wednesday’s close price of Rs783.20.

Anneloes Geldermans, a spokeswoman for ING in Amsterdam confirmed that the Dutch group had sold its 3.1% stake in the Indian lender, but refused comment on the price at which the deal was struck.

ING’s decision to sell its stake in Kotak was taken after “careful consideration" and is part of the bank’s “back to basics" programme announced in April 2009, which included a planned €8 billion in asset sales, she said.

Shares in Kotak Mahindra, which the market values at roughly $6 billion, fell as much as 3.4% after the block deal to their lowest in a week. By 11.20am, shares in Kotak Mahindra were down 2.2% at Rs766.

Citibank was the sole adviser to the deal, the sources said.

On Tuesday, another Dutch lender, Rabobank moved a step closer to setting up its own banking unit in India as it cut its stake in mid-sized local lender Yes Bank for about $213 million.

Citi was also the adviser on that deal, a separate source had said on Tuesday.

Standard Chartered, Credit Suisse and Citibank are expanding their services and Goldman Sachs has applied for a banking licence in India, whose economy is forecast to grow more than 8% this fiscal year.