(Bloomberg) -- Canadian pension fund manager Caisse de Depot et Placement du Quebec is among suitors vying to buy a stake in Kotak Mahindra Bank Ltd. being sold by India's richest banker, people with knowledge of the matter said.
Billionaire Uday Kotak is in discussions about the potential sale of more than 3 percent of the Mumbai-based lender to the Caisse, Canada's second-largest pension fund, according to the people. Other investors are also competing for the stake, one of the people said, asking not to be identified because the information is private.
Uday Kotak
A sale would help Kotak comply with a central bank directive to cut his ownership in the lender to 30 percent by the end of June. The tycoon and related parties hold a 33.6 percent stake in Kotak Mahindra Bank, which is India's fourth-largest private-sector lender by assets, exchange filings show. The stake Kotak needs to sell is worth about 54 billion rupees ($810 million) based on Tuesday's stock price, according to data compiled by Bloomberg.
Shares of Kotak Mahindra Bank rose 2.4 percent to 836.55 rupees at 9:22 a.m. Wednesday in Mumbai, giving the lender a market value of about $23 billion. The benchmark S&P BSE Sensex was little changed. Kotak, who started the lender in 2003, will have to trim the stake to 20 percent by the end of 2018 and 15 percent by the end of March 2020, according to a February exchange filing.
Talks could falter, and there's no certainty the discussions will result in a transaction, the people said. A representative for the Caisse and a spokesman for Kotak Mahindra Bank and its founder declined to comment.
Kotak is worth $8.2 billion, making him India's eighth-richest person, according to the Bloomberg Billionaires Index.
To contact the reporters on this story: George Smith Alexander in Mumbai at galexander11@bloomberg.net, Anto Antony in Mumbai at aantony1@bloomberg.net, Scott Deveau in Toronto at sdeveau2@bloomberg.net.
To contact the editors responsible for this story: Ben Scent at bscent@bloomberg.net, Marcus Wright at mwright115@bloomberg.net, Elizabeth Fournier at efournier5@bloomberg.net, Russell Ward
Essential Business Intelligence, Sharp Market Insights, Practical Personal Finance Advice, Daily Fuel, Gold and Silver Prices and Latest Stories — On NDTV Profit.
