UTI Mutual Fund is planning to rope in strategic investors without diluting the majority stake of its promoters, according to Finance Minister P Chidambaram.
“The fund house is doing well, but feels a little shackled. It is not able to compete with others. We are looking at ways to bring in strategic investors without diluting the majority stake of the three banks and LIC,” Chidambaram told the media after the UTI mutual fund board meeting.
SBI, Bank of Baroda, Punjab National Bank and LIC are the promoters of UTI mutual fund.
At the meeting, the finance minister reviewed the future plans of the fund house and the performance of the mutual fund industry in general.
UTI Mutual Fund had scheduled an IPO earlier this year, with 20 per cent being offered to the strategic investors through the pre-IPO placement route.
However, uncertainty in the global environment and correction in the domestic equity markets compelled UTI to postpone its public issue.
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UTI has not yet firmed up plans on re-filing for the public issue. “We will wait and watch how things shape up. We are waiting for the global and domestic markets to stabilise,” UK Sinha, Managing Director, UTI Mutual Fund, said.
The fund house admitted that it was searching for a partner. “We are looking for partners who will provide the right synergy. We would focus on bringing in a strategic investor rather than a financial investor, without losing our public sector character,” he said.
Pointing out that SUUTI was being wound up, the finance minister expressed confidence that the process would be completed by March 31 next year.
“Till now, 15 lakh investors have redeemed Rs 21,000 crore. The current year has saw the redemption of Rs 6800 crore in favour of 11 lakh investors,” Chidambaram said.