Singapore-based hedge fund Tree Line Asia Master Fund (Singapore) Pte has sold over 4% stake in Tata-controlled mountain water bottling company Mount Everest Mineral Water, owner of the Himalayan range of non-aerated beverages. The hedge fund has struck the deal to offload its majority stake after reportedly realizing ‘a substantial premium’ on its investment, market sources said.

?It is a typical hedge fund strategy to exit a firm once the promoters have grown in size, they (hedge funds) get a substantial return on their investment and no exit option through an IPO is in sight in near future?, a fund manager tracking hedge funds told FE.

Though, he refused to put a number to the deal nor the premium pocketed by the hedge fund, it is reliably learnt Tree Line has struck the deal at an average price of over Rest 70 per share, which is at a premium on the company’s closing price on the Bombay Stock Exchange on Tuesday. The scrip closed at Rest 66.30 on Tuesday, down by 0.23%.

According to information available with FE, the hedge fund has sold 4.27% of its stake or close to 14.5 laky shares in Mount Everest in two trenches. Post sale, Tree Line’s holding in Mount Everest has come down to 1.32%. As of December quarter, the hedge fund was holding 19 laky shares aggregating 5.59% of the total voting capital of the company.

Besides Tree Line, Iran, A Rumania sold 35,019 shares in Mount Everest on March 19 at a price of Rest 68.52 a share. Milk mates Put Ltd bought 37,300 shares on March 22 at Rs 66.72 a share.

In the non-promoter category, Tree Line was the second largest shareholder in the company with a 5.59% stake, while Gujarat Flurochemicals has been the single largest non-promoter stakeholder with a 6.87% stake.

The Tata Group, which took over the company in 2007, holds a 50.24% stake in the small-cap company with Tata Tea, the single largest shareholder, holding 40.92%, Foresight Holdings 6.62%, Vindo Sethi 2.53% and Tata Investment Corporation 2.53%.

Mount Everest is one of the leading players in over Rs 100-crore mountain mineral water market. It owns the Himalayan brand of mineral water range. The other major players in this segment include Bisleri and Evian. As of March last year, the company clocked a total turnover of Rs 22 crore and posted a net loss of Rs 2.75 crore.

Tree Line is an Asia-focussed hedge fund with offices in Hong Kong and Singapore. It has also invested in Janalakshmi Financial Services, a microfinance institution.