Capital markets regulator Sebi has kept proposed initial share-sale of Aditya Birla Sun Life AMC in "abeyance", an update with the watchdog showed on Monday. However, the Securities and Exchange Board of India (Sebi) did not clarify further.
The asset management company had filed preliminary papers with Sebi in April to raise funds through through an initial public offer (IPO).
Going by the draft papers, the proposed IPO is entirely an offer for sale, wherein two promoters-- Aditya Birla Capital and Sun Life (India) AMC Investments-- will divest their stake in the asset management firm.
The proposed IPO of up to 3.88 crore equity shares comprises an offer for sale of up to 28.51 lakh equity shares by Aditya Birla Capital and up to 3.
6 crore equity shares by Sun Life AMC.
The proposed sale of equity shares by Aditya Birla Capital and Sun Life India in the IPO will together constitute up to 13.50 per cent of the paid-up share capital of Aditya Birla Sun Life AMC.
On the basis of the average industry price earning ratio, the IPO is expected to fetch Rs 1,500-2,000 crore, merchant banking sources said.
Without disclosing the reason, Sebi said "issuance of observations kept in abeyance" with regard to IPO, according to the latest update as on June 25.
In market parlance, this observation of Sebi is a kind of its go-ahead to float the public issue.
Aditya Birla Sun Life AMC Ltd, the investment manager of Aditya Birla Sun Life Mutual Fund, is a joint venture between Aditya Birla Group and Sun Life Financial Inc of Canada.
Asset management firms like Nippon Life India Asset Management, HDFC AMC and UTI AMC are already listed on the stock exchanges.
Aditya Birla Sun Life MF, the fourth largest fund house, had an average assets under management of Rs 2.7 lakh crore as of March quarter.
Kotak Mahindra Capital Company, BofA Securities, Citigroup Global Markets India, Axis Capital, HDFC Bank, ICICI Securities, IIFL Securities, JM Financial, Motilal Oswal Investment Advisors , SBI Capital Markets and YES Securities (India) Ltd are the merchant bankers to the issue.