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Reliance Capital (RCap) has got the approval of its shareholders to sell stake to Japan's Sumitomo Mitsui Trust Bank. Sumitomo will take an initial 2.77% strategic stake in RCap amounting to Rs 371 crore ($58.4 million) through preferential allotment, with a lock-in period of one year. The investment is being made at Rs 530 a share representing a premium of 11% to the stock price of relevant date of Reliance Capital.
The non-banking financial company led by Anil Ambani said the allotment resolution was passed by a majority of 99.99% shareholders who voted on the resolution.
"The members of the company have duly approved, vide e-voting, the business as specified in the notice convening the said meeting viz Preferential Allotment of 70,00,000 equity shares of Rs 10 each at a premium of Rs 520 per share aggregating to Rs 371 crore to Sumitomo Mitsui Trust Bank, Limited of Japan," the company said in a notice to stock exchanges.
Sumitomo Mitsui Trust Bank is the fourth largest in Japan by market capitalisation and corporate loans. It is Japan's largest financial institution, managing assets worth $682 billion with assets under custody of $1.8 trillion as of September 2014.
Reliance Capital has stated it wants to establish a new bank in India. During the last round of bank licences in April 2014, Reliance Capital's application was not approved by the Reserve Bank of India.
