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RBI, LIC to other sponsors to dilute stake in UTI mutual fund
June 16, 2023
Sponsors of UTI Mutual Fund, including State Bank of India (SBI), Punjab National Bank (PNB) and Life Insurance Corporation of India (LIC), have initiated the process to dilute their stake in India’s oldest fund house.
According to sources, these entities have approached merchant bankers to advise on stake sales.
UTI Mutual fund is promoted by the SBI, LIC, PNB and Bank of Baroda (BoB), having a combined holding of 45.21 per cent in the paid-up capital.
US-based T Rowe Price Group through its wholly-owned subsidiary T Rowe Price Global Investment Services (UK) presently holds a 23 per cent stake in UTI Asset Management Company (UTI AMC).
These sponsors diluted their stake through an initial public offering (IPO) in 2020 by selling 38,987,081 shares for ~2,100 crore. The entire proceeds of the offer went to all the promoters, including T Rowe Price.
The IPO came after the markets regulator Sebi order dated December 6, 2019, directing LIC, SBI and BoB to reduce their stake by December 2020, failing which, the regulator would freeze their excess voting rights.
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