State Bank of India (SBI), the country’s largest lender, will divest 2.1 crore equity shares (2.1% stake) for at least Rs 1,522.50 crore in its insurance subsidiary SBI Life.
The lender decided to sell its stake to comply with the minimum public shareholding (MPS) norms of 25%, through offer for sale process as per SEBI guidelines.
Offers opens on June 12 for non-retail investors and June 15 for retail investors. Floor price is at Rs 725 per share, which is at a discount of 2.14% to the closing price of June 11.
The public sector lender holds 57.60% stake in the company as on 31 March.
Investment bank Nomura is advising SBI on the share sale.
From the beginning of the year, Shares of SBI and SBI Life have fallen 47% and 23% respectively against a fall of 19% in the benchmark index, Sensex. From the March lows, SBI and SBI Life gained 18% and 43%, while Sensex gained 31%.
Meanwhile, the lender will also decide on raising long-term fund up to $1.5 billion through bonds.
The executive committee of SBI’s central board will examine the status and decide on long term fund raising in single/multiple tranches up to $1.5 billion through public offer and/or private placement of senior unsecured notes in US Dollar or any other convertible currency during FY2020-21.
On a standalone basis, SBI’s net profit surged more than four times to Rs 3,580.81 crore for the quarter ended 31 March against Rs 838.40 crore for the same quarter last year. Total Income rose 4.1% to Rs 78,758.85 crore in Q4 March 2020 over Rs 75670.50 crore in Q4 March 2020.
This document is meant for the recipient only for use as intended and not for circulation. This document should not be reproduced or copied or made available to others. The information contained herein is from the public domain or sources believed to be reliable. While reasonable care has been taken to ensure that information given is at the time believed to be fair and correct and opinions based thereupon are reasonable, due to the very nature of research it cannot be warranted or represented that it is accurate or complete and it should not be relied upon as such. Also above note is not a recommendation to Buy or SELL and is only a view based on facts and figures and we will be in no way responsible for any losses incurred by anyone who uses this information to either trade or invests securities mentioned herein.