Mumbai, April 12: Singapore's Heliconia Pte Ltd is buying a 2.6 per cent equity stake in Kotak Mahindra Bank (KMBL) for Rs 1,296 crore, valuing the private sector lender at around Rs 50,000 crore.
Heliconia is an affiliate of Government of Singapore Investment Corporation Pte Ltd (GIC). It will pick up the stake by subscribing to a preference issue of two crore equity shares of Kotak Mahindra Bank.
The bank said it was selling the shares for Rs 648 apiece, a premium of a little over 3 per cent to its scrip's closing price on Thursday.
Shares of the bank rose 1.44 per cent to Rs 637.75 after the announcement of the deal today even as the Sensex tanked nearly 300 points.
The private sector lender added that the preferential equity issue was subject to shareholder and other necessary regulatory approvals.
It said the transaction would raise its Tier 1 capital (core capital), and the funds would be used to pursue growth opportunities.
Besides, the promoters' stake will get diluted in line with a RBI directive.
Promoters led by Uday Kotak now hold around 45 per cent stake, much higher than the norms fixed by the apex bank, which wants promoters stakes to come down to 20 per cent in five years.
It was initially speculated that the central bank might ask the promoters to reduce their shareholdings further to 10 per cent.
However, the RBI's final guidelines for setting up new private sector banks indicate a different position.
Since the apex bank wants the stake of promoters of new private banks be reduced to 15 per cent, it is now clear that promoters of some of the existing private sector banks will have to bring down their stake to 15 per cent.
The promoters of Kotak Mahindra Bank had earlier sought more time ' till 2025 ' to bring down their stake
As on December 31, 2012, the consolidated net worth of Kotak Group stood at Rs 14,568 crore, and the capital adequacy ratio of the bank (standalone) was 15.6 per cent, with the core capital at 14.2 per cent.
Heliconia is an affiliate of GIC, which is a global investment management company incorporated in 1981 to manage Singapore's foreign reserves.