American private equity (PE) firm The Carlyle Group is planning to offload its entire 33 percent stake in PNB Housing Finance in the next 18 months, according to a media report.
Carlyle is likely to mandate Morgan Stanley to lead the sale, reported The Economic Times. The PE firm had bought a 49 percent stake in PNB Housing Finance for Rs 1,600 crore in February 2015.
Carlyle would yield a return that’s several times the money it invested three years ago post a deal, said the newspaper report.
PNB Housing Finance's shares lost over six percent in morning trade, on Monday, post reports of Carlyle's planned exit from the company. The stock dropped 6.28 per cent to hit a low of Rs 1,063.35 on the BSE.
The Punjab National Bank (PNB), on 8 June, said that it would divest its stake in its housing finance subsidiary and in other entities like the BSE, ICRA and Crisil depending on market conditions.
"The Board of Directors vide e-circulated agendas approved on 8 June, 2018, has authorised the management to initiate the process and take appropriate decision to disinvest stake in PNB Housing Finance, ICRA Ltd, CRISIL Ltd and BSE Ltd at appropriate time depending on the market conditions and options available," the bank said in a regulatory filing.
PNB Housing Finance, one of the main subsidiaries of PNB, is engaged in the business of providing housing and construction loans. PNB had a 32.96 percent stake in the subsidiary as on 31 March, 2018.
It is interesting to note here that at one point PNB Housing Finance was more valuable than its parent company PNB, which has seen its market capitalisation more than halve since being hit by a banking fraud allegedly perpetrated by billionaire diamantaire Nirav Modi and his uncle Mehul Choksi.
PNB Housing Finance's mcap, on 17 May, stood at Rs 21,199.07 crore. On the other hand, PNB's mcap was Rs 20,842.33 crore.
The offloading of stakes in non-core assets is part of PNB's reforms agenda, adopted in January this year.
With inputs from PTI
Updated Date: Jun 11, 2018 22:07 PM