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The promoter group will shed 22.75 per cent in Religare Enterprises Ltd (REL) to be eligible to apply for a banking licence.
At today’s market price, the 22.75 per cent stake is worth about Rs 1,075 crore, a back-of-the-envelope calculation showed. Once the stake sale happens, the promoters’ holding in REL will come down to 49 per cent from 71.75 per cent.
REL is controlled by billionaire brothers Malvinder Mohan Singh and Shivinder Mohan Singh personally and through a clutch of companies.
“We are very pleased that they (the promoters), considering the long-term strategic value of a banking business for Religare, have agreed to dilute their shareholding,” a REL spokesperson told Business Line .
The promoters have also agreed to appoint Axis Capital as their advisor to help them divest the stake. On May 23, the REL board had decided to apply for a banking licence. As per the RBI guidelines for new banks in the private sector, a promoter group can promote a bank through a non-operative financial holding company .
Such a holding company should be owned by the promoter group companies in which the public hold at least 51 per cent.
“At Religare we continue to work diligently with our application process and keep progressing on the path of building an integrated financial services business in India,” the spokesperson added.
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