Axis Bank,Indias third largest private sector bank,has decided to sell 25 per cent stake in its wholly-owned subsidiary,Axis Asset Management Company Limited,to Schroder Singapore Holdings Private Limited,a subsidiary of Schroders. The bank has also revised the swap ratio of its merger plan with Enam Securities to 5 for 1 instead of 5.7 for 1 earlier,thus bringing down the cost of acquisition by around Rs 670 crore to Rs 1,396 crore.
The transaction with Shroders is subject to regulatory approval and is expected to complete during 2012.
The transaction provides Axis AMC access to Schroders global distribution network and to advise overseas funds invested in Indian securities.
Schroders is a global asset management company with 187.3 billion pounds under management as of December 2011.
Shikha Sharma,MD and CEO of Axis Bank said,We look forward to collaborating with Schroders distinctive product and global distribution franchise in the coming years. However,the bank did not give financial details of the sale.
25% rise in Q4 profit
Driven by higher interest income,Axis Bank has reported a 25.2 per cent rise in net profit to Rs 1277 crore for the quarter ended March 2012 as against a profit of Rs 1,020 crore for the previous quarter ended March 2011. Net interest income or the difference between interests earned and paid,climbed 26 per cent to Rs 2,146 crore. For the fiscal year 2011-12,net profit rose by 25 per cent to Rs 4,242 crore. Gross non-performing asset (NPA) ratio improved to 0.94 per cent.