ICICI Pru's Top Holders Weigh $570 Million Offering

Updated on
  • Prudential, ICICI Bank mulling possible deal to pare stakes
  • Sale would help ICICI Prudential meet public float requirement

ICICI Prudential Life Insurance Co.’s two biggest shareholders are weighing a sale of about a 6 percent stake in the Indian insurer, according to people with knowledge of the matter.

Prudential Plc and ICICI Bank Ltd. are considering a possible deal to pare their stakes as soon as in the next few months, said the people, who asked not to be identified as the information isn’t public. The stockholders are weighing a sale to help the Mumbai-based company meet the requirement of a minimum 75 percent public float, according to the people.

Shareholders may decide to cut their stakes through multiple transactions, and a final decision on the size of any sale will only be taken after arrangers are appointed, one of the people said. A six percent stake would be worth about 36.5 billion rupees ($570 million), based on Tuesday’s closing price, data compiled by Bloomberg show.

ICICI Prudential priced a 60.6 billion-rupee initial public offering about a year ago, the first such listing from a pure-play insurer in Mumbai. SBI Life Insurance Co. plans to finish taking investor orders this week for a first-time share sale of as much as 84 billion rupees, while HDFC Standard Life Insurance Co. is also preparing an offering.

Shares of ICICI Prudential closed 2.8 percent lower in Mumbai trading on Wednesday after falling as much as 5.2 percent, the biggest intraday decline in nearly five months.

There’s no certainty the deliberations on the ICICI Prudential stake will lead to an imminent transaction, said the people. A spokesman for ICICI Bank said he couldn’t immediately comment. Prudential remains committed to the Indian market through its "highly successful" Prudential ICICI business, a spokesman for the company said.

ICICI Bank currently owns 54.9 percent of the insurer, while Prudential has a 25.8 percent stake, exchange filings show. The shareholders plan to sell stock to help the company meet the minimum public float requirement after listing, according to the insurer’s 2016 IPO prospectus.

Prudential plans to keep at least a 20 percent stake, while ICICI Bank won’t reduce its holding below 54 percent, the prospectus shows.

— With assistance by Oliver Suess

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