Uday Kotak Exploring Potential Takeover of IndusInd Bank
Uday Kotak Exploring Potential Takeover of IndusInd Bank
- IndusInd Bank: completely denies the said rumor and considers it malicious, untrue and baseless.
- Kotak Mahindra’s bank spokesman declined to comment.
Kotak Mahindra Bank Ltd. backed by Uday Kotak is exploring a takeover of smaller Indian rival IndusInd Bank Ltd.,people with knowledge of this matter said, a move that would create the nation’s eighth-largest financial firm by assets.
Uday Kotak, founder and ceo of Kotak Mahindra Bank Ltd. is viewing the chance of an all stock acquisition, one among the people said, asking to not be identified as the talks are private. Kotak Mahindra’s Founder and Ceo, Uday Kotak and the family of Hinduja group have held initial talks over the proposal in which the founders of IndusInd Bank Ltd. could retain a stake in the lender after a deal, another person .
A deal would cement Kotak Mahindra bank position together of India’s leading private banks, boosting its assets by about 83per cent, It would also throw a lifeline to IndusInd Bank Ltd., which has seen its market value drop 60per cent to $6 billion this year after being hit by concerns over worsening asset quality and an erosion of low-cost deposits. Kotak Bank in 2014 acquired the local unit of ING Groep NV for 150 billion rupees ($2 billion) within the most important takeover of a lender in India. Deliberations are at an early stage and talks could fall flat, the people said.
Kotak Mahindra’s bank spokesman declined to comment and IndusInd Bank “completely denies the said rumor and considers it malicious, untrue and baseless,” the bank’s external spokesman said in an email, adding the founders “reiterate their full support to IndusInd Bank, now and always.”
The U.K.-based Hinduja family began discussions for selling control of the Mumbai-based lender following a dispute between the four brothers over the longer term of the family’s $11.2 billion fortune, one of the people said.
India’s central bank earlier this year pushed back on the Hinduja brothers’ decide to raise stake in IndusInd, people with knowledge of the matter said in June.
Kotak Mahindra’s Bank Rs.2.7 trillion market capitalisation makes it India’s third-largest lender by value.
IndusInd’s shares have fallen 64per cent within the past year as investors fretted over the founders borrowing money against its shares, worsening asset quality, and erosion of low-cost deposits,The brothers have since repaid the loan backed by shares of the bank.
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