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Wednesday, Mar 27, 2002

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Hindujas sell part of stake in IndusInd?

Dinesh Narayanan

MUMBAI, March 26

THE Hindujas have reportedly sold a part of their stake in IndusInd Bank in negotiated deals. A top official of the bank said it was possible that the deal had taken place. It could, however, not be ascertained who bought the stake.

The promoters of IndusInd Bank reportedly reached an informal understanding with the Reserve Bank of India last week that in the current fiscal year ending March 31 they would sell seven per cent of their 56.25 per cent stake in the bank. According to RBI rules, they have to bring down their stake to 40 per cent. They have assured the regulator that they would divest another 9.25 per cent early next fiscal, the official said.

According to stock market sources, the promoters may have sold part of their stake on Tuesday as a couple of large block deals were reported to have taken place. More than 20 lakh shares changed hands on the BSE today and volumes on the NSE crossed 14 lakh shares. The IndusInd scrip rose 4.83 per cent on the BSE to close at Rs 17.35. It closed at Rs 17.10 on the NSE, up 4.26 per cent.

The IndusInd Bank official said there was a proposal a couple of months ago to merge Ashok Leyland Finance and Hinduja Finance Ltd — both Hindujas-promoted non-banking financial corporations — with IndusInd Bank to bring down the stake. However, the proposal did not go down well with the RBI. The dismal stock market conditions also ruled out an IPO, which was another option to dilute promoters' stake. The Hindujas' 56.25 per cent stake is held through two companies — IndusInd Enterprises and Finance Ltd, which holds 31.3 per cent, and the Mauritius-based IndusInd International Holdings Ltd, which holds 25 per cent.

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