Reality firm DLF today said it sold its entire 39 per cent stake in mutual fund joint venture (JV) DLF Pramerica Asset Managers with partner Prudential Finance, as its participation is not in conformity with the Securities and Exchange Board of India’s (Sebi’s) modified guidelines.
“DLF’s decision to exit from this area of business was triggered due to changes by Sebi in its evaluation criteria for getting approval to the joint venture mutual fund to commence its business,” a release said here.
According to the Sebi guidelines, DLF does not qualify to be a sponsor for a mutual fund with its less than five years of track record in the financial services.
DLF, in December 2007, had signed an agreement to set up a mutual fund joint venture DLF Pramerica Asset Managers, with Prudential Finance picking up 61 per cent and the remaining to be subscribed by DLF.
The venture was supposed to be based out of Mumbai and provide an array of products to retail and institutional clients.
Following DLF’s exit, the AMC business would be named as Pramerica Asset Managers Pvt Ltd, it said.
However, the life insurance venture between the two parties would continue to work as usual, according to a joint statement.
DLF owns 76 per cent in the venture. New York Stock Exchange-listed Prudential Finance is a financial services leader with around $641 billion of assets under management as on September 30, 2009.
