Non-resident Indian (NRI)-businessman Surachan Chawla is likely to offload 14.5 per cent of the stake held in Kerala-based Catholic Syrian Bank (CSB) to a clutch of foreign investors this week to conform with a Reserve Bank of India’s (RBI’s) directive.
The board of CSB is meeting tomorrow to consider the sale. Chawla, who holds 24.5 per cent stake in the private sector bank, was asked to bring down his holding to 10 per cent by the central bank, as it was not happy with a single party holding a significant stake. “The board is meeting tomorrow to consider the sale or transfer of close to 15 per cent shares of Chawla. This is because RBI wants him to reduce holding to 10 per cent,” said CK Gopinath, director, CSB.
Though Gopinath declined to divulge further details about the deal, it is understood that the Chawla has talked to 10-15 Bangkok-based NRIs to sell less than 1 per cent stake to each.
The local catholic community under the chairmanship of archbishop, had formed an action committee and received commitments for around Rs 250 crore to buy Chawla’s shares and, thereby, ensure control of the lender.
The group was still continuing negotiations with the NRI investor, sources said.
Last year, Kochi-based Federal Bank had expressed its interest to take over the unlisted CSB, but the move did not take off following differences over valuations. After Federal Bank announced its plan to take over CSB, the Syrian Catholic Church in general and the Thrissur Archdiocese, in particular, were riled at the move and were very vocal in opposing it.
Three Mauritius-based private equity funds — AIF Capital, Garfmore Private Equity and Siguler Guff — together hold about 15 per cent. Other major stakeholders of CSB are engineering major L&T and Edelweiss, and together they have 5 per cent. Federal Bank also holds 5 per cent stake, while a group of local investors together hold around 15 per cent.
CSB officials denied media reports that Religare Enterprises has made a Rs 800-crore offer to acquire CSB. When contacted, Religare Enterprise’s Group Chief Operating Officer Sachindra Nath refuted the report, saying it was “absolute rubbish”.