Punjab National Bank (PNB) is picking up 30 per cent equity in an asset management company (AMC) promoted by Principal Financial Group for a consideration of Rs 42 crore.
The bank is also in talks with Berger Paints for acquiring 25 per cent stake in a life insurance venture co-promoted with Principal and Vijaya Bank.
PNB chairman S S Kohli said PNB AMC will be shut down by the end of the month and its assets will be transferred to the new company where Principal will hold 65 per cent stake.
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Bank sources said that the new AMC, PNB Principal, will pay a 3.5 per cent premium on the Rs 126 crore assets to be taken over by it. Vijaya Bank will hold the remaining 5 per cent stake in the mutual fund venture.
While 13 per cent shares in PNB Principal are being acquired at the net asset value of Rs 61, the remaining 17 per cent shares will be purchased at Rs 182 each, the price at which Principal purchased Industrial Development Bank of India