StanChart to buy out UTI Sec stake in PD arm

Standard Chartered Bank (StanChart) will acquire the 26 per cent stake held by UTI Securities in its primary dealership subsidiary"� Standard Chartered UTI Securities India Pvt Ltd (SCUTI).

UTI Securities had acquired the stake in the joint venture primary dealer for Rs 13 crore in April 2001. SCUTI was set up in July 2000. Primary dealers underwrite government bond auctions and also trade in government securities.

"UTI Securities has approached us to buy out their stake in the joint venture. We are currently in the process of finalising the modalities of the stake purchase," said sources in Standard Chartered.

Securities Trading Corporation of India Ltd (STCI), itself a primary dealer, is the new owner of UTI Securities. STCI decided to sell UTI Securities' stake in SCUTI as the Reserve Bank of India regulations do not allow a single entity to hold interests in more than one primary dealer.

STCI recently acquired UTI Securities for Rs 265 crore, outbidding Bank of Baroda and Standard Chartered Bank.

The Specified Undertaking of Unit Trust of India (SUUTI) sold UTI Securities' stake to STCI after a bidding process. It is mandated to encash investments in subsidiaries and in companies such as engineering and construction major Larsen & Toubro.

The business and affairs of SCUTI are managed by Standard Chartered Bank under the general superintendence, control and direction of the SCUTI board.

UTI Securities was only an investment partner and did not carry out operations or maintain any records or documents of SCUTI at its office.