Canadian pension fund manager Caisse de dépôt et placement du Québec is among suitors vying to buy a stake in Kotak Mahindra Bank Ltd. being sold by India's richest banker, people with knowledge of the matter said.
Billionaire Uday Kotak is in discussions about the potential sale of more than 3 per cent of the Mumbai-based lender to the Caisse, Canada's second-largest pension fund, according to the people. Other investors are also competing for the stake, one of the people said, asking not to be identified because the information is private.
A sale would help Kotak comply with a central bank directive to cut his ownership in the lender to 30 per cent by the end of June. The tycoon and related parties hold a 33.6 per cent stake in Kotak Mahindra Bank, which is India's fourth-largest private-sector lender by assets, exchange filings show. The stake Kotak needs to sell is worth about 54 billion rupees ($810-million) based on Tuesday's stock price, data compiled by Bloomberg show.
Shares of Kotak Mahindra Bank have gained 14 per cent this year, giving it a market value of $22.5-billion. Kotak, who started the lender in 2003, will have to trim the stake to 20 per cent by the end of 2018 and 15 per cent by the end of March 2020, according to a February exchange filing.
Talks could falter, and there's no certainty the discussions will result in a transaction, the people said. A representative for the Caisse and a spokesman for Kotak Mahindra Bank and its founder declined to comment.
Kotak is worth $8.2-billion, making him India's eighth-richest person, according to the Bloomberg Billionaires Index.