Nippon Life Insurance Company on Friday announced an open offer for about 22.49 per cent stake in Reliance Nippon Life Asset Management (RNAM) for about ₹3,179 crore, as Reliance Capital looks to exit the mutual fund business to raise funds.

“This open offer is being made by the acquirer (Nippon Life) to all the public shareholders of the target company to acquire up to 13.82 crore equity shares, constituting 22.49 per cent of the expanded voting share capital... at a price of ₹230 per offer share payable in cash,” a draft letter of offer filed with the BSE said.

Reliance Capital had, in May, announced plans to exit the mutual fund business by selling its stake in RNAM to its joint venture partner Nippon Life Insurance.

“Both partners currently hold 42.88 per cent each in the company, while the rest is with public shareholders... The entire proceeds of approximately ₹6,000 crore will be utilised to reduce Reliance Capital’s outstanding debt by 33 per cent,” Reliance Capital had said on May 23.

Reliance Capital has already signed binding definitive agreements with Nippon Life Insurance. RNAM had sold 4.82 crore equity shares through an offer for sale last month.

An open offer by the acquiring company is mandatory under SEBI guidelines to buy equity shares in a target company.

Following the open offer, Nippon Life will hold a 75 per cent stake in RNAM. It will have the right to re-constitute RNAM’s board of directors, including the right to appoint nominee directors, or to seek the resignation of any director.

On Friday, the RNAM scrip gained 0.3 per cent and closed at ₹219.55 on the BSE

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