Shares of India’s major private sector lender Kotak Mahindra
Bank reversed gains Friday after the bank clarified on
Berkshire Hathaway’s stake buy report. Kotak Mahindra Bank has
clarified that it is unaware of any plans by Berkshire Hathaway
to buy a 10% stake in the company. Kotak Mahindra Bank said in
a statement on the exchages that it has nothing to report to
the exchanges on the news item that appeared on CNBC TV18.
Earlier, the channel had reported citing sources that Warren
Buffett is eyeing a 10% stake in the bank. Berkshire Hathaway
may look to invest $4-6 billion in Kotak Mahindra Bank,
CNBC-TV18 said citing sources. Berkshire Hathaway may look at
buying promoter stake via preferential allotment to invest in
Kotak Mahindra Bank, CNBC-TV18 reported citing sources. The
channel further reported the channel adding that it is awaiting
response from Berkshire Hathaway. Kotak Mahindra Bank which had
advanced 13% on the news to intra-day high of 1,345.95, slipped
to about 1,240.80.
“Kotak Mahindra Bank Limited is unaware of any plans by
Berkshire Hathaway buying stake in the Bank….”, said the
private lender in an exchange filing.
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Meanwhile, the RBI had earlier
asked promoters of Kotak Mahindra Bank to bring down their
stake to 20 percent by December 2018 and 15 percent by March
2020 in line with the guidelines for new bank licenses released
four years ago. The RBI licensing guidelines for new private
sector banks 2013, calls for promoter holding to be brought
down in phases, first to 40 percent at the end of five years
from the date of commencement of business operations.
Kotak Mahindra Bank is an Indian private sector bank
headquartered in Mumbai, Maharashtra, India. In February 2003,
Reserve Bank of India (RBI) issued the licence to Kotak
Mahindra Finance Ltd., the group’s flagship company, to carry
on banking business.