NEW DELHI: State Bank of India (SBI) today said it plans to dilute 10 per cent of its stake in the life insurance venture SBI Life through public offer.
The Executive Committee of Central Board in its meeting held today accorded in-principle approval for initial public offer (IPO), SBI said in a regulatory filing to stock exchanges.
The board has given approval to “initiate process for offer for sale of 10 per cent of shares through initial public offer”, it said.
SBI also said it is exploring the possibility of diluting 8 per cent stake sale of SBI Life through IPO out of 10 per cent Offer for Sale.
SBI Life Insurance is a joint venture between the bank and BNP Paribas Cardif. SBI owns 74 per cent of the total capital and BNP the rest.
BNP ruled out increasing its stake in SBI Life to 49 per cent ahead of the proposed initial public offering slated for next year.
The insurer has an authorised capital of Rs 2,000 crore and a paid up capital of Rs 1,000 crore.
SBI had last year sold 3.9 per cent stake in SBI Life to global private equity major KKR and the Singaporean sovereign fund Temasek Holdings for Rs 1,794 crore or USD 264 million, valuing the country’s third largest private life insurer at around Rs 46,000 crore.
After this stake sale, SBI’s stake in the arm came down to 70.1 per cent from 74 per cent while BNP Paribas Cardif still holds 26 per cent.