In a landmark event for the mutual fund industry, US-based T. Rowe Price Global Investment Services Ltd. (TRP), the subsidiary of US-based T Rowe Price Group has acquired 26 per cent stake in UTI Mutual Fund for Rs 650 crore.
With this, TRP has become the single largest individual stakeholder in UTI Mutual Fund. The company bought 6.5 per cent stake each from four sponsors of UTI MF — State Bank of India (SBI), Punjab National Bank (PNB), Bank of Baroda BoB) and Life Insurance Corporation of India (LIC).
“The sponsors, who each held 25 per cent stake in the company, would now hold 74 per cent stake in UTI MF collectively,” said UK Sinha, Chairman and Managing Director of UTI Asset management Company. UTI was valued at Rs 2,500 crore.
KP Krishnan, Joint Secretary in the Department of Economic Affairs, Ministry of Finance said, “The move sends a message that India is open and continues to be open to foreign investment wherever it is needed.”
“This collaboration would help accelerate growth, and bring in best practices, systems and processes of TRP,” said Sinha while denying plans of floating an initial public offer.
“Our respective management teams, cultures and values fit well together,” said Edward Bernard, Chairman and President of T Rowe Price.