Andersen seen joining fray to find partner for Centurion

Srikesh P Menon

Mumbai, Dec 2: Eveb as Infrastructure Leasing & Financial Services (IL&FS) is playing Cupid to find a partner for Centurion Bank promoter Davendra Ahuja’s 26.2 per cent stake, Arthur Andersen is learnt to have joined the fray.

Though Centurion director VS Srinivasan and Andersen officials denied the move, sources confirmed the developments. IL&FS is playing the role of an investment bank and is taking a close look at the bank’s books for a third party. IL&FS sources declined that they were interested in picking up the stake themselves.

International Finance Corporation is in charge of the whole process of scouting for a strategic partner for the bank. Another audit firm is also looking at the books of the bank. While announcing the financial results earlier, Mr Srinivasan had said the bank had been in talking to three interested parties for the 26.2 per cent stake of TCFC Finance, which is owned by Mr Ahuja. These three parties are, however, not dealing directly with the bank but are in touch with IFC.

Sources close to the developments also said no one had been shortlisted so far to take up the stake, adding stability and ability to pump in more funds is the main criteria and also it is a very long process and could take up to end-March to get some results.

The other stake holders in Centurion are Keppel Bank (17.5 per cent) through Kephinance Investment (Mauritius), Asian Development Bank (10.22 per cent) and IFC (8.36 per cent).

Centurion had reported a net loss Rs 31.24 crore for the second quarter ended September 30, 2001, over a Rs 9.67 crore profit in the same quarter last fiscal. Operating profit was at Rs 2.01 crore (Rs 12.76 crore). The bank also reported a net loss of Rs 26.14 crore for H1 ended September 30, against a profit of Rs 21.43 crore last year.
The main promoters of the bank, Mr Ahuja, and TCFC Finance which holds 23.1 per cent, have failed to meet the commitment under the financial support agreement between them and the bank.