Ex­it­ingFIIs­toBook Hand­someGains­from Ujji­vanIn­vest­ments

The Economic Times - - Companies: Pursuit Of Profit -

Kolkata: Over­seas in­vestors such as Mau­ri­tius Uni­tus Cor­po­ra­tion would earn about nine times of its in­vest­ment while World Bank’s for­mer president James Wolfen­sohn’s private eq­uity fund WCP Hold­ings III and FMO (Nether­land­sDevel­op­men­tFi­nance Com­pany) would end up mak­ing nearly four times their in­vest­ment when Ujji­van Fi­nan­cial Ser­vices lists on the stock exchange.

These for­eign in­sti­tu­tional in­vestors along with Women’s World Bank­ing Cap­i­tal Part­ners are ex­it­ing Ujji­van, which is in the process of di­lut­ing for­eign hold­ing to be­low 49%, a manda­tory rule for its trans­for­ma­tion­in­toas­mall­fi­nance­bank. Mau­ri­tius Uni­tus Corp, which holds 2.49% in Ujji­van, ac­quired the shares at an av­er­age cost of ₹ 23.54 while it would off­load the hold­ings at ₹ 207-210. The fi­nal price of the ini­tial public of­fer will be fixed fol­low­ing a book build­ing method. WCP Hold­ings III and FMO had in­vested in Jan­uary 2012 pay­ing ₹ 57 per eq­uity share, ac­cord­ing to the red her­ring prospec­tus filed by Ujji­van. These in­vestors hold 3.06% and 2.67% re­spec­tively. Women’s World Bank­ing Cap­i­tal Part­ners holds 5.34% at an av­er­age cost of ₹ 68.37 per share. Ujji­van manag­ing di­rec­tor & chief ex­ec­u­tive Samit Ghosh said these four will exit fully while four oth­ers in­clud­ing In­ter­na­tional Fi­nance Corp, El­e­var Eq­uity Mau­ri­tius and Sarva Cap­i­tal will par­tially di­lute their po­si­tion.

In­dus­try watch­ers said in­vestors might not have sold their hold­ings but for the dik­tat from the Re­serve Bank of In­dia that small banks re­duce their for­eign hold­ings to 49%. “IFC’s made its first in­vest­ment in Ujji­van in 2012 and has a cur­rent out­stand­ing ex­po­sure of $ 2 3 mi l l i o n through debt and eq­uity. Ujji­van con­tin­ues to be a strate­gic client for IFC,” said Nilesh Shri­vas­tava, man­ager-fi­nan­cial in­sti­tu­tions group, South Asia, IFC. Ghosh said the public of­fer of shares would help it to re­duce for­eign hold­ing to around 45%. When the ur­ban-fo­cused mi­cro lender re­ceived in­prin­ci­ple small bank fi­nance li­cense along with nine other com­pa­nies in­clud­ing Equitas Hol d i ngs a nd Ja nal a k s hmi Fi­nan­cial Ser­vices in Septem­ber last year, over­seas in­vestors had about 90% own­er­ship in it.

The IPO con­sists of a fresh is­sue of shares worth 358 crore and of­fers for sale by ex­ist­ing share­hold­ers

Newspapers in English

Newspapers from India

© PressReader. All rights reserved.