IDBI Bank set to sell entire stake in SHCIL to IFCI

Mar 22 2014, 05:15 IST
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SummaryPublic sector lender IDBI Bank plans to sell its entire stake of 18.95% in the Stock Holding Corporation of India (SHCIL) to the Industrial Finance Corporation of India

Public sector lender IDBI Bank plans to sell its entire stake of 18.95% in the Stock Holding Corporation of India (SHCIL) to the Industrial Finance Corporation of India (IFCI), IFCI said in a BSE filing.

IDBI Bank holds 39.9 lakh shares in the company and is the second-largest stakeholder after IFCI, which holds 33.91%, or 71.4 lakh shares. A senior IDBI Bank official said the deal valuation will be arrived at a meeting early next week.

“An independent valuation of SHCIL’s equity shares was carried out by IFCI and the board of directors of IFCI approved the acquisition of IDBI's entire equity holding of 18.95% in SHCIL at the share price based on the said valuation,” said IFCI, which provides financial assistance to manufacturing and infrastructure sectors, in the filing.

The company added that the offer for purchase has been accepted by IDBI and, as a result, IFCI's equity holding in SHCIL will become 52.86%. Earlier this month, IDBI Bank had said it plans to sell its part or full stake in SHCIL and that the board, at its meeting on February 28, accorded its in-principle approval for initiating the process.

Last month, a consortium of shareholders — led by IDBI Bank — received just one bid for selling its stake in Credit Analysis & Research (Care). Also, the price offered was lower than the R900 per share anticipated. IDBI Bank holds the largest chunk of shares in the company at 16.69% at the end of Q3. An IDBI executive said that the offer should perhaps have been left open for a longer period, but banks had wanted to complete the sale by the end of March.

Public sector lender Central Bank of India had sold its stake of 5% in Credit Information Bureau (India) (Cibil) to TransUnion International Inc earlier this month. TransUnion, a US-based credit information and information management services company, held 27.5% in Cibil before the stake sale. Punjab National Bank, too, sold its 5% stake in Cibil to TransUnion.

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