Bank of India likely to acquire controlling stake in Bharti AXA AMC
05 Mar 2011
Bharti Enterprises, which has been keen to exit the mutual fund business, is reportedly finalising plans to sell a 51-per cent stake in Bharti AXA Investment Managers to public sector Bank of India.
While both sides have refused to offer any comments on the deal, it is learnt that the state-owned bank will acquire majority control over the mutual fund company, which had assets worth Rs.412 crore as at the end of December 2010.
The asset management company reported a net loss of Rs.42.14 crore for the year ended March 31, 2010 (as against Rs.45.62 crore in the previous fiscal). Recent months have seen at least four senior executives quit the company. Prateek Agrawal, Bharti AXA Investment Manager's equity head, was the latest to leave the firm earlier this month.
Other top executives to have left included the human resources head, the fixed-income chief and the business development head. Sandeep Dasgupta, the chief executive officer, had last week said that the asset management company was scouting for a suitable bank partner with a pan-India distribution network.
''Since AXA didn't want to compromise on the business partner, it took us some time to identify one,'' revealed Dasgupta. ''As of now, we are in advanced stages of discussions with a very strong bank partner,'' he added, without, however, identifying the bank.
Bank of India, among the leading nationalised banks, had entered the mutual funds business way back in 1990. But it exited the business about 15 years later, selling two of its remaining schemes to Taurus Mutual Fund.