(For more on upcoming Indian IPOs, click on <IN/IPOMENU>)
(Adds detail, background, bylines)
By Narayanan Somasundaram and Nishant Kumar
MUMBAI, July 7 (Reuters) - India's UTI Asset Management has
put off plans for a $480 million share sale after falling stocks
hit sentiment, joining other firms that have pulled or deferred
offerings, six sources with direct knowledge of the matter said.
UTI, India's No. 4 mutual fund, was not confident of a good
response after the stock market slumped 23 percent in the past
seven weeks, the longest stretch of weekly losses in seven years.
"It's deferred," one source in UTI told Reuters, referring to
the proposed sale that must be launched by July 22, according to
the regulator's approval.
ICICI Securities, a unit of No. 2 lender ICICI Bank
<ICBK.BO>, JSW Energy and Vedanta Energy are among firms that
have delayed plans for an IPO due to a subdued market.
UTI, which manages $12 billion, had aimed to sell 49 percent
through sale by its founders and fresh issue of shares by the
asset manager in a price band of 270-320 rupees a share.
The sale was slated for launch in mid-July, with private
placement of new shares set to happen before that, said the
sources, including bankers involved in the deal.
"We were just not comfortable after the slide in the
secondary market in the last fortnight. The pace at which it fell
dented our confidence totally," said one banker, who did not want
to be identified because he was not authorised to speak.
An UTI spokesman declined comment.
The 30-share BSE index <.BSESN> fell about 8 percent in the
last two weeks, rattled by rising interest rates, 13-year high
inflation and record oil prices.
The benchmark index had slid 18 percent in June, its sharpest
monthly fall in 16 years, and is down nearly a third this year.
Government-run lenders State Bank of India <SBI.BO>, Punjab
National Bank <PNBK.BO> and Bank of Baroda <BOB.BO> and
state-owned Life Insurance Corp each own 25 percent of UTI.
They had proposed to sell 48.5 million shares, or 35 percent
of the equity, for up to $360 million. UTI had hoped to raise up
to $120 million through issue of fresh shares.
After the IPO and private placement, public holding in the
asset manager would have been 49 percent, including shares held
by employees trust.
JM Financial <JMSH.BO>, Citigroup <C.N>, Enam Securities,
Goldman Sachs <GS.N>, UBS <UBSN.VX>, ICICI Securities, SBI
Capital Markets and CLSA India are advisers to the issue.
Indian IPO proceeds fell 7 percent to $4.3 billion from 29
deals in the six months to June, Thomson Reuters data showed.
After a $3 billion offering, India's largest, from Reliance Power <RPOL.BO> in January, offerings have declined sharply in
every month, with some such as the Indian unit of Dubai's Emaar
Properties <EMAR.DU> withdrawing its IPO.
An IPO by KSK Energy Ventures, a unit of London-listed KSK
Power Ventures <KSK.L>, was subscribed less than two times
forcing the company to fix the issue price at the bottom of the
band at 240 rupees a share.
($1=43.1 rupees)
(Editing by Ranjit Gangadharan)
(([email protected]; +91-22-6636 9247; Reuters Messaging: [email protected]))
Keywords: INDIA UTI/
Keywords: INDIA UTI/