ICICI Prudential IPO: ICICI Bank may trim its stake to 54% in insurance arm

ICICI Bank - the second largest private sector lender in terms of assets, may plan to trim it's stake by 13% in the insurance arm ICICI Prudential Life Insurance in the next three years.

This move comes at a time when ICICI Prudential is coming up with initial public offering (IPO) from September 19 – September 21. The insurance service provider plans to raise around Rs 6000 crore from this IPO. 

"The understanding between the shareholders is that when we arrive at the 25 per cent public shareholding over a three-year period, ultimately the Bank will hold 54 per cent stake and 20 per cent will be held by Prudential," said Chanda Kochhar on Business Standard.

The price band of the IPO has been fixed between Rs 300 – Rs 334 per equity shares.

In this IPO, the bank is offering around 181,341,058 equity shares for sale at a face value of Rs 10 each. The offer includes a reservation upto 18,134,105 equity shares for purchase by ICICI Bank shareholders – excluding such other persons not eligible under applicable laws, rules, regulations and guidelines and also American depository receipt holders of the bank, it said in a statement.

The sole or first bidder in the reservation portion has to be an ICICI Bank shareholder.

Under the details, the shareholder bidding in the bank's reservation portion – subject to the payment amount not exceeding Rs 2 lakh can also bid under the net offer and they will not be treated as multiple bids.

While bidder with above Rs 2 lakh amount bidding cannot bid in net offer as such bids will be treated as multiple bids.

Overall the IPO offer will consist of 12.63% of the post-offer paid-up equity share capital of the company and the net offer shall constitute 11.37% of the post-offer paid-up equity share capital of the company.

Presently, ICICI Bank holds around 68% stake in ICICI Prudential Life Insurance, while Prudential Group hold around 26% stake.