Categories: Business

Uday Kotak reduced stake in Kotak Mahindra Bank, sold 5.6 crore shares for Rs 6944 crore

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Uday Kotak sells 2.83percent stake in Kotak Mahindra Bank for Rs 6,944 crore

new Delhi. Billionaire banker Uday Kotak has sold the promoter group's 2.83 per cent stake in Kotak Mahindra Bank for Rs 6,944 crore. The deal was completed on Tuesday. This sale of shares was done in open market deals. Following the sale, Uday Kotak promoter group's stake in private sector Kotak Mahindra Bank declined to 26.10 percent from 28.93 percent. It will be in line with the Reserve Bank's set standards. However, Uday Kotak will now have to sell the remaining 0.10 per cent more stake to comply with Reserve Bank rules by mid-August.

The Reserve Bank had ordered Uday Kotak to reduce its stake in the bank to 26 percent. Kotak Mahindra Bank earlier this weekend raised Rs 7,400 crore through the placement of shares to eligible institutional investors. After this allotment, the promoter group's stake in the bank declined slightly by more than one percent to 29.8 percent. An agreement was reached between the Reserve Bank and Kotak earlier this year. Under this, the promoter's stake in Kotak Bank is to be brought to 26 percent by August.

According to market sources, Kotak Bank shares were sold at a peak price range of Rs 1,215 to Rs 1,240 per share. As per the rule, the share sale should not be less than one percent of the previous day's closing price. In this sense, the price was being made at Rs 1,236 per share, but the bank sold it at Rs 1,240 per share. Investors who bought Kotak Mahindra Bank shares include The Regents of the University of California, Openheimer Developing Market Fund, JP Morgan Securities, HSBC Global Investment Funds, Fidelity Funds – Emerging Markets Fund, Societe Generale Canoda and Morgan Stanley Asia Singapore etc. .

Along with these, SBI Mutual Fund, Aditya Birla Sun Life Mutual Fund, ICICI Prudential Life Insurance Company and Nippon India Mutual Fund have also bought these shares. The issue of dilution of stake between billionaire businessman Uday Kotak and the Reserve Bank had been going on for a long time. Uday Kotak's holding in Kotak Mahindra Bank was held by the Reserve Bank over a higher holding than the set standards, dragging its compliance.

This post was published on June 3, 2020 1:01 pm

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