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Grapevine: Investec eyes SBI Caps stake; SoftBank sets 5-year IPO deadline for Paytm
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The local unit of South African financial services group Investec is leading the race to buy a stake in State Bank of India’s institutional broking and investment banking unit, a media report said.

India’s largest bank is planning to sell a stake of up to 50% in SBI Capital Markets Ltd, The Economic Times reported, citing three people familiar with the development.

The report said that the two sides had explored an option to merge Investec’s local business with SBI Caps with the South African company holding 50%. However, SBI may not been keen on a merger as it wants to sell a stake to raise cash, the report added.

Investec began operating in India as an aircraft financier, acquiring a merchant banking licence in 2012. It has expanded its offerings over the years to include corporate finance, equity capital market services, fixed-income and institutional equities in India.

The company has beefed up its India team in recent months, VCCircle reported in October.

In another report, The Economic Times said that Paytm investor SoftBank Vision Fund has told the Indian digital payments company to go public within five years from the time of completion of the latest funding transaction.

If Paytm fails to float an initial public offering, SoftBank will have the right to sell its stake to a rival company, the report said.

Paytm is looking to raise as much as $1 billion in the new round. US-based asset manager T Rowe Price is likely to invest up to $200 million while existing backers SoftBank and Alibaba Group affiliate Ant Financial may infuse the rest, the report said, citing sources.

SoftBank first invested in Paytm in 2017 and holds a 19% stake. Alibaba Group owns almost double the stake and had first invested in the company in 2015.

In another development, Tata Opportunities Fund is looking to exit its minority stake investment in Tata Projects Ltd, Mint reported, citing two people aware of the development.

Tata Opportunities had invested Rs 335 crore in Tata Projects in 2015 to provide an exit to four Tata companies—Tata Steel Ltd, Tata Motors Ltd, Indian Hotels Co. and Tata International Ltd. It now holds a 24.12% stake in the engineering, procurement and construction company.

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