Financial Daily from THE HINDU group of publications
Wednesday, May 03, 2006
Financial Daily from THE HINDU group of publications Wednesday, May 03, 2006 |
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Money & Banking
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Life Insurance Standard Life stake sale to Citi okayed Our Bureau
Mumbai , May 2 The board of directors of Housing Development Finance Corporation Ltd (HDFC) today gave its approval to the UK-based Standard Life group to sell its entire holding in the company to Citigroup Inc. The sale is subject to approval from the Foreign Investment Promotion Board. In the event the transfer of shares is approved, CitigGroup may nominate a special director on the Board of HDFC, said a statement from the latter. Standard Life currently holds 9.27 per cent stake in HDFC through Slac Mauritius Holdings Ltd. It will exit HDFC making a good profit, although its sale price to Citigroup has not been disclosed. It had entered HDFC ten years ago with a 5 per cent stake at Rs 2,400 per share of face value Rs 100 (currently the face value of the scrip is Rs 10). After a bonus issue from HDFC in 2002 and acquisition of another 5 per cent stake in the open market, its direct stake increased. Standard Life had also bought 4.81 per cent stake in 2002-2003 in the FII category but disposed of it later. The HDFC scrip rules at Rs 1,300-plus currently. Standard Life's exit from HDFC will pave the way for the UK insurer to increase its direct stake, currently at 18.24 per cent, in HDFC Standard Life Insurance Company. Until now, its stake in HDFC had amounted to an additional effective stake in HDFC Standard Life.
More into insurance venture
"Standard Life hopes to acquire the balance 7.76 per cent stake of the entitled FDI in HDFC Standard Life which amounts to 4.81 crore shares," said a senior official from HDFC. The price and timing of the transfer of shares will be decided independently by HDFC Ltd and Standard Life," said the official.
More Stories on : Life Insurance | Mergers & Acquisitions | Foreign Banks | Housing Development Finance Corporation Ltd
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