Tatas evaluate bid for UTI AMC as Reliance enters the MF Space
Tata Group, India's biggest conglomerate by market capitalisation, is understood to be considering its options and carefully evaluating whether to bid for UTI Asset Management Company, industry sources told ET, after Mukesh Ambani-owned Jio Financial Services entered the market amid increasing financialisation of savings in a country where real estate and bullion have long been the preferred stores of value.
Officials close to the development said the salt-to-software conglomerate is watching the marketplace to assess Jio's future plans and their impact on the competitive dynamics of the pooled-money industry. Financial sector majors view Jio Financial Services as a potentially disruptive player at a time when the Indian mutual fund industry is expected to welcome half a dozen new entrants.
Four state-owned financial entities — Punjab National Bank, Life Insurance Corporation of India, State Bank of India, and Bank of Baroda — together own just over 45% stake in UTI Asset Management Company.
They are collectively — and individually — exploring options to invite formal bids from interested parties for selling their stake and appointed SBI Capital Markets as a banker for the deal.
Earlier, the Tata Group was understood to be in advanced talks to buy a majority stake in UTI AMC from the four public sector entities, but the discussions fell through after a large investor in the AMC insisted that the others follow a formal bidding process to sell their stakes instead of using the nomination route.
«There is a lot of interest for sure in the UTI AMC and the group would have been happier to close the bid much earlier. But that didn't happen, unfortunately,» said an official aware of the matter.
