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Our Bureau

New Delhi, Aug 13 IFCI Ltd (IFCI) on Monday invited expression of interest (EoI) from Indian and foreign investors for taking a minimum 26 per cent stake in the financial institution through a preferential allotment of new equity shares.

A two-stage process is proposed to be followed for the selection of an investor, who has to be from financial services space. At the EoI stage, which is the first stage, applicants are to be pre-qualified on the basis of certain minimum criteria that has been specified in the EoI document released today.

Under the technical capability parameters, the applicant would be required to have financial service experience of not less than five years on its own. Either the applicant itself could be in the business of financial services or exercise management control through ownership of not less than 26 per cent of the equity capital of a company with financial services experience.

Moreover, the applicant should also meet the additional minimum criteria which specifies that the applicant should have average financial asset portfolio on the balance sheet of not less than Rs 8,000 crore or equivalent for last three years.

Alternatively, if the applicant has ownership of not less than 26 per cent in a company, then the average financial asset portfolio of the balance sheet of that company should be at least Rs 8,000 crore or equivalent for last 3 years.

Under financial capability parameters, an applicant would be judged on the basis of whether it has asset book of at least Rs 10,000 crore as per the last audited accounts for financial year not earlier than 2006 or networth of not less than Rs 4,000 crore or average assets under management for a fund (both equity and debt assets) of not less than Rs 10,000 crore.

Also, a minimum equity holding requirement has been stipulated, which would place the applicant shareholding to a minimum lock-in of 3 years from the date of transaction.

The due date for EoI submission is September 14 and the shortlist is expected to be announced on September 25. The entire process of identifying the investor and allotment of shares is expected to be completed by end-January 2008.

More Stories on : Financial Institutions | Preferential Allotments | Mergers & Acquisitions

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