SUUTI's Arsec stake sale gains steam

The stake sale process of Asset Reconstruction Company (Arsec) by its principal shareholder, the Specified Undertaking of Unit Trust of India (SUUTI) is gathering steam, according to a person privy to the development.

A top SUUTI official said: ���Some of the existing shareholders have evinced interest in increasing their stake in Arsec. However, it depends on the price. If we are not comfortable with their offered price, we may offload it to a new investor.���

Besides SUUTI, which holds around 37% stake in Arsec, the other shareholders include Bank of India, Allahabad Bank, Indian Bank, Andhra Bank, Life Insurance Corporation of India, Deutsche Bank and IL&FS. ���We are exploring all the possibilities of either offloading the entire stake to a single buyer or to a group of entities,��� he added.

As per RBI guidelines, a single entity cannot hold more than 49% equity stake in an asset reconstruction company, which essentially buys non-performing loans from banks and financial institutions and sells it to third party investors, including corporates and private equity funds.


(Contributed by Reena Zachariah & Shailesh Menon)