Standard Life to sell 2.82% HDFC AMC stake1 min read . Updated: 17 Jun 2020, 01:33 AM IST
The move will help the promoter group comply with Sebi norms that mandate that the promoter group should not have more than 75% holding in a company
MUMBAI : Standard Life Investments Ltd, one of the promoters of HDFC Asset Management Co. Ltd, will offload a 2.82% stake in the fund house through an offer for sale, it said in a stock exchange filing on Tuesday.
HDFC AMC, which manages assets of nearly ₹3.2 trillion, is jointly owned by HDFC Ltd (52.76%) and Standard Life (26.89%), with a 79.6% promoters’ stake. The move will help the promoter group comply with Sebi norms that mandate that the promoter group should not have more than 75% holding in a company.
“HDFC does not want to reduce its stake, but Standard Life has been reducing its stake as part of the global strategy. This way the promoter group will be able to bring their holding to 75%," said a person, requesting anonymity.
“Standard Life Aberdeen has been monetizing its investments in India as part of its plans at the parent level to shore up capital reserves in its home markets. The investments in the joint venture with HDFC have been very profitable for them and hence, these are some of the assets that they have been monetizing," said a second person, also requesting anonymity. Standard Life will sell 6 million equity shares at a floor price of ₹2,362—a considerable discount on its closing price of ₹2,535 on the NSE on Tuesday. The offer for sale opens on Wednesday for the non-retail segment and on 18 June for retail investors.
The base deal size stands at ₹1,417.2 crore. Oversubscription option will entail sale of an additional 2.82% stake, which would take the total deal size to ₹2,834.40 crore. If it is oversubscribed it would bring down Standard Life’s stake in HDFC to 21.3%, else the holdings will reduce to 24.1%.
Swaraj Singh Dhanjal contributed to this story.