M&M looking to own nearly 10% in RBL Bank
RBL Bank. M&M said Wednesday it already owns 3.5% of the lender, a stake the conglomerate bought in secondary market transactions. The entire deal, when completed, will make M&M the biggest stakeholder in RBL Bank along with investment fund Maple.
Mahindra's disclosure comes amid evident regulatory caution over banking ownership by business houses. The Reserve Bank of India (RBI) abandoned a proposal that would have permitted business houses to eventually own banks after public resentment against an internal working group suggestion in favour of allowing such ownership. The Mahindra Group already owns a non-banking finance company (NBFC).
«We have acquired a 3.53% stake in RBL Bank as an investment at a cost of ₹417 crore,» the Mahindra group said.'Open to Acquiring More' «We may consider further investment subject to pricing, regulatory approvals and required procedures. However, in no circumstance will it exceed 9.9%,» the company said. On Wednesday, RBL was the first to issue a clarification to the stock exchanges in response to media reports that the Mahindra Group was looking to take a «strategic stake» of more than 15% in the bank.
The bank said that as per the latest beneficiary position as on July 21, 2023, from the National Securities Depository Ltd (NSDL), the shareholding of M&M is 3.53% of the total paid-up share capital of the bank. RBL, however, clarified that as per the central bank's directions on acquisition and holding of shares in banking companies, any shareholder willing to acquire 5% or more of the shareholding in a bank must seek prior approval from the RBI. «No such application has been received by us to date,» RBL Bank said.
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