UTI AMC To Launch IPO On 29 Sept; SBI, LIC And BoB To Sell Stake

UTI Asset Management Company will launch its initial public offering on 29 September, wherein 3.8 crore shares will be available for bidding.

State Bank of India, LIC and Bank of Baroda will sell 1.04 crore equity shares each in the AMC while PNB and T Rowe Price International will offload 38.03 lakh equity shares each via offer-for-sale.

The IPO will close on 1 October but the price band for IPO is yet to be announced.

Kotak Mahindra Capital Company, Axis Capital, Citigroup Global Markets India, DSP Merrill Lynch, ICICI Securities, JM Financial and SBI Capital Markets are the book running lead managers to the issue.

In December 2019, SEBI had directed LIC, SBI and BoB to reduce their stakes below 10 percent in UTI AMC.

SEBI rules introduced in March 2018 put a cross-holding limit which does not allow a shareholder who has at least 10 percent stake in a mutual fund to hold a similar-sized stake in another fund house. Board positions would also have to be given up. This was introduced to eliminate conflicts of interest.

All the Indian stakeholders, except PNB, have their own AMC businesses.

In compliance with the cross-holding rules, the regulator also wants their nominees to be removed from boards of UTI AMC and UTI Trustee Co before 31 December 2020.

SBI then said that it would off-load 8.5 percent of its 18.5 percent stake in the company through the IPO.