Kotak Mahindra Bank subsidiary to sell 31% stake in Infinia Finance for ₹1,293 crore
Kotak Mahindra Bank on Saturday, March 21, said its wholly-owned subsidiary Kotak Mahindra Capital Company Limited (KMCC) has signed definitive agreements to sell part of the shares of Infina Finance Private Limited for Rs 200,000. ₹1,293 crore.
According to an exchange filing shared with NSE and BSE on Saturday, KMCC will sell 30.99% of its shares in Kotak Mahindra Bank’s partner company Infinia Finance for a total consideration. ₹12,93,91,10,882.
The agreements, signed on March 21, see KMCC divest its 30.99% stake in Infinia through multiple transactions.
Here are the details of the agreement.
Kotak Mahindra Bank share sale details
The share transfer will largely consist of three transactions; A portion of KMCC shares will go to Rakesh Jhunjhunwala’s trust fund and will be transferred to two companies. Under the share sale agreement, Kotak Mahindra Bank’s KMCC will:
a) Transfer of 2,17,899 shares representing 9.90% of Infina’s capital to Derive Trading and Resorts Private Limited and Bright Star Investments Private Limited for the total price ₹413.35.00,450.20;
b) KMCC will also transfer 2,66,321 equity shares representing 12.10% of the share capital of Infina to the Estate of deceased investor Rakesh Jhunjhunwala through their Trust for the total consideration. ₹505,20,56,105,80; And
c) The share sale will also include the transfer of 1,97,870 shares representing 8.99% of Infina’s capital to Infina’s existing shareholder KF Trust (“KF Trust”) for a total consideration. ₹375,35,54,326.
The bank also said in its stock exchange filing that the said transactions with Derive Trading, Bright Star Investments and Jhunjhunwala trusts were not part of related party transactions. The transaction with KF Trust, whose beneficiaries are part of a promoter group, qualifies as a related party transaction, the bank said. However, this sale is done in a ‘distanced’ manner.
These transactions are subject to completion of customary conditions precedent and upon completion will result in Infina ceasing to be a subsidiary of Kotak Mahindra Bank.
Following the sale, KMCC’s stake in Infinia will drop to 19%.
Kotak Mahindra Bank said the transactions, which were initiated on March 21, are expected to be completed on or before March 31.
Financial details of Infinia Finance
Kotak Mahindra Bank also shared relevant financial information about Infinia until March 31, 2025 in its file. Details are shared below —
- Endorsement: ₹532.66 crore
- Turnover as a percentage of Kotak Mahindra Bank’s Consolidated Total Revenue: 0.50%
- Net worth: ₹2,727.99 crore
- Net worth as a percentage of Kotak Mahindra Bank’s Consolidated Total Net worth: 1.73%
- Paid-in capital: ₹2.20 crore.
Kotak Mahindra Bank share price
Shares of Kotak Mahindra Bank will be closely watched following Monday’s key share sale. At the end of Friday’s session, Kotak Mahindra Bank’s stock price remained at the same level. ₹366.95 per share compared to previous close ₹367.95 per share.
Kotak Mahindra Bank shares opened with a rise ₹It touched 371 on BSE on Friday, hitting its intraday high. ₹At 372.60, before closing gains flat. ₹367.95 each.
Key Takeaways
- The share sale involves multiple parties and significant financial amounts, indicating strategic repositioning.
- Post transaction, Kotak Mahindra Bank’s stake in Infinia will drop to 19%, which will affect the bank’s influence in the company.
- Investors should monitor the market reaction and financial implications of the divestiture.
