Warburg Pincus divests 1.3% stake in IDFC Bank worth ₹790 crore via block deal
United States-based private equity firm Warburg Pincus has divested a partial stake in IDFC Bank on Thursday, December 7 through a block deal. The US private equity firm, through its affiliate company Dayside Investment, has sold 1.3% stake or 9.17 crore shares in the private lender.
The transaction between the companies were finalised at ₹86.1 per share, totalling to ₹790 crore. However, the buyers in the transaction are still unknown.
According to available data, Dayside Investment held 1.3% stake in the bank, meanwhile, another affiliate Cloverdell Investment owned 2.74% stake in the IDFC First Bank, as of November 2023.
Warburg Pincus’ both affiliates Dayside Investment and Cloverdell Investment together owned 8.5% of the company, as of June quarter.
In September, the private equity firm, via Cloverdell Investment, divested a 4.2% stake in IDFC First Bank for ₹2,480 crore through block deals. Concurrently, GQG Partners, supported by Rajiv Jain, acquired a 2.6% stake in the financial institution for ₹1,527 crore.
Over the past three quarters, foreign portfolio investors have consistently increased their ownership in the bank. As of the end of September, FPIs collectively held a 26.06% stake, a notable rise from the 19.31% reported at the end of March.
While IDFC First Bank shares have witnessed a 6.5% gain in the five sessions since November 30, it’s worth noting that the stock has corrected by over 3% since the last sale by Warburg Pincus on September 1.
On Thursday, the company witnessed a nearly 3% decline in its shares, which settled at ₹87.75 on the NSE. Throughout the year (YTD), the stock has consistently ranked among the top performers in the private sector category, surpassing most of its counterparts with an impressive gain of almost 54%. Notably, the global index aggregator MSCI Inc recently included the stock in its MSCI India index.
In the September quarter, the bank, which is in the process of merging, disclosed a noteworthy 35% year-on-year increase in net profit, amounting to ₹751 crore. Concurrently, net interest income experienced robust growth, surging by 32% to reach ₹3,950 crore
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Published: 07 Dec 2023, 09:17 PM IST
Ganesh
http://ganesh@finplay.inFinance enthusiast, Mutual fund expert.