Reliance Cap gets shareholders' nod to sell stake to Sumitomo Mitsui

Reliance Capital (RCap) has got the approval of its shareholders to sell stake to Japan's Sumitomo Mitsui Trust Bank. Sumitomo will take an initial 2.77% strategic stake in RCap amounting to Rs 371 crore ($58.4 million) through preferential allotment, with a lock-in period of one year. The investment is being made at Rs 530 a share representing a premium of 11% to the stock price of relevant date of Reliance Capital.

The non-banking financial company led by Anil Ambani said the allotment resolution was passed by a majority of 99.99% shareholders who voted on the resolution.

"The members of the company have duly approved, vide e-voting, the business as specified in the notice convening the said meeting viz Preferential Allotment of 70,00,000 equity shares of Rs 10 each at a premium of Rs 520 per share aggregating to Rs 371 crore to Sumitomo Mitsui Trust Bank, Limited of Japan," the company said in a notice to stock exchanges.

Sumitomo Mitsui Trust Bank is the fourth largest in Japan by market capitalisation and corporate loans. It is Japan's largest financial institution, managing assets worth $682 billion with assets under custody of $1.8 trillion as of September 2014.

Reliance Capital has stated it wants to establish a new bank in India. During the last round of bank licences in April 2014, Reliance Capital's application was not approved by the Reserve Bank of India.