Reliance Capital To List AMC Arm In FY18
Reliance Nippon Life Asset Management plans to sell at least 10% stake through an IPO.
The board of directors of Reliance Nippon Life Asset Management Ltd. has approved plans to sell at least 10 percent stake in the company through an initial public offering this financial year, Sundeep Sikka, the company's executive director and chief executive officer at a press conference in Mumbai on Wednesday.
Subsequently, the company will look to raise public shareholding to 21 percent by 2021.
This could be the first initial public offering by a major asset management company (AMC) in India though smaller rival UTI MF’s IPO plans have been in the works for a long time.
The Anil Ambani-promoted Reliance Capital currently owns 51 percent stake in the asset management company, which is currently the third largest in the country by way of assets under management. The remainder is held by Japan's Nippon Life Insurance Company.
The company's management declined to comment on whether the stake sale through IPO would be by way of a fresh issue of shares or an offer for sale by the existing promoters.
"We want to be in a state of readiness for growth, both organic and inorganic," said Sikka, when asked about the objective of the IPO. "Both Nippon Life and Reliance Capital will be participating in the IPO for Reliance Nippon Life Asset Management," he added.
The company will now seek regulatory approval for the IPO and will begin discussions with merchant bankers, lawyers and auditors, it said in a media statememt.
Reliance Mutual Fund is the third largest player in India’s 42-member strong mutual fund industry. Reliance Nippon Life Asset Management has assets under management (AUM) of Rs 3.6 lakh crore, including Rs 2.11 lakh crore for mutual funds.
