It?s a deal

Mumbai, Dec. 27: ICICI Bank cut its stake in Federal Bank by 4.5 per cent through two block deals worth Rs 54.18 crore on the Bombay Stock Exchange today.

The stake sale is part of ICICI Bank?s plans to bring down its stake in Federal Bank to 5 per cent within a definite timeframe. A Reserve Bank regulation has capped a bank?s (which has operations in India) holding in another bank at 5 per cent.

The RBI has asked many banks to submit a definite roadmap for reducing their holding to 5 per cent.

As on September 30, ICICI Bank held close to 20.76 per cent, or 1.36 crore shares, in Federal Bank.

ICICI Bank has said it has no intention of taking over the Kerala-based bank and its role was that of an institutional shareholder. ICICI Bank had acquired the stake through Federal Bank?s capital raising programmes from 1993.

In two separate block deals, a couple of entities belonging to ICICI Bank sold close to 31.50 lakh shares of Federal Bank at Rs 176 per share and Rs 170.41 per share, respectively. Kuroto Fund LP and Goldman Sachs bought the shares.

Market circles say ICICI Bank has sold the shares at a decent premium. It had paid an average price of Rs 100 apiece for these shares and sold at a premium of 75 per cent.

However, this is not the first time in recent days that Federal Bank shares were offloaded in the market. Last week the bank had witnessed block deals.