Private equity firm ChrysCapital sold over around four-fifths of its holding in private lender ING Vysya Bank via open market transactions on Tuesday.
The PE firm encashed Rs 674 crore ($108 million) in the process. The stake was bought by a couple of US-based asset management firms.
ChrysCap held 4.5 per cent stake in ING Vysya as of December 31, 2014 and was the single-largest institutional shareholder of the firm. It has now sold 3.7 per cent of this and its remaining stake is worth around Rs 167 crore.
ChrysCapital had originally bought shares of the bank way back in 2004 and cashed out part of it in 2009 only to put in more money later.
Its exit comes right ahead of a the proposed merger of the bank with Kotak Mahindra Bank.
In November, Kotak Mahindra Bank struck a deal to buy ING Vysya Bank in an all stock merger worth over $2.4 billion. The proposed merger recently received shareholders’ approval and is now awaiting approvals from the Reserve Bank of India and the Competition Commission of India.
Under the deal, shareholders of ING Vysya will get shares of Kotak Mahindra Bank as per the swap ratio of 725 shares of Kotak for every 1,000 shares held by them in ING Vysya.
The merger has hit a few hard spots with the employees of ING Vysya as they fear job cuts and they had called for a one-day strike last week.
Shares of ING Vysya Bank closed at Rs 997.95, up 3.95 per cent in a weak Mumbai market on Tuesday.
Other existing investors in ING Vysya include Norwest, ICICI Venture and Norwegian sovereign fund Government Pension Fund Global among others.
For ChrysCap this is the first liquidity event this year after striking part/full exits from five of its portfolio firms in 2014 including NCC (formerly Nagarjuna Construction), Amtek Auto, Intas, HCL Technologies and Gammon India.
(Edited by Joby Puthuparampil Johnson)