State Bank Of India To Sell Up To 4.5% Stake In SBI Life Insurance
The floor price for the sale has been set at Rs 770 per share—a discount of 4 percent to today’s closing price.
State Bank of India said it will sell stake in its life insurance arm to meet the minimum public shareholding norms.
SBI’s board has approved an offer-for-sale of at least 3.5 percent stake—or 3.5 crore shares—in SBI Life Insurance Company Ltd., with an option of oversubscription of 1 percent, India’s largest lender informed the exchanges today.
The floor price for the sale has been set at Rs 770 per share—a discount of 4 percent to today’s closing price of Rs 799.65—the life insurer said in a separate filing. The sale for institutional investors will take place on Sept. 12 and retail investors on Sept. 13.
After completion of the sale, SBI’s stake in SBI Life will drop from 62.1 percent to 57.6 percent. The insurer’s other promoter BNP Paribas Cardif, a subsidiary of the France-based BNP Paribas group, holds 5.20 percent in the company, according to data available on the Bombay Stock Exchange.
In March, Carlyle Group had acquired 9 percent stake in SBI Life from BNP Paribas for Rs 4,600 crore.
While SBI’s filing didn’t give details, a senior executive at the bank told BloombergQuint on the condition of anonymity that Carlyle Group is not categorised as a public shareholder. As a result, the minimum public float had fallen below the required 25 percent, necessitating share sale by SBI.
The SBI Life stock closed 0.9 percent lower today, but have gained 33 percent so far this year compared with the benchmark S&P BSE Sensex’s 2.8 percent rise.