Can Bank to sell MF arm stake to Robeco

Canara Bank, planning to sell stake in its fully owned mutual fund arm in December, is likely to finalise the Netherlands-based Robeco for the proposed joint venture, industry officials said.

The bank is likely to retain 51% or more stake in its mutual fund arm after the stake sale. Most fund officials feel the deal would be valued at 6-7 per cent of assets under management.

The mutual fund manages Rs 26.38 billion assets.

In September, Canara Bank's chairman had said they will announce the decision on stake sale in mutual fund arm in third quarter.double click Robeco, the asset management arm of Rabobank Group, has around 1,600 employees in nine countries.

At the end of 2005, Robeco's assets under management were euro 131 billion

The main offices are in Rotterdam and New York. Robeco also has banking and asset management operations in France and sales offices in Belgium, Switzerland, Germany, Spain, South America, West Asia, and Japan.

Many global companies are looking for footprints in Indian mutual fund industry because of an upbeat stock market, rising disposable income, and huge untapped retail assets.

Among the latest global players to enter the industry was Lotus India Mutual Fund, a joint venture between Singapore-based Alexandra Fund Management and Sabre Capital Worldwide, which started its operations this week.

Many top global asset management companies like Aegon, UBS, AIG, JP Morgan, and Dawnay Day have announced plans to set up fund houses in India.

Others like Vanguard, American Capital, T Rowe Price, and some Japanese funds are also considering India plans.

Last year, BNP Paribas Asset Management Co. acquired 49.9 per cent stake in Sundaram Mutual Fund.

Recently, even Bank of Baroda announced its plan of selling stake in mutual fund arm to a global entity.