Crisis-hit IL&FS may get a lifeline with LIC, SBI likely to increase stakes Noor Arora
Infrastructure Leasing & Financial Services (IL&FS) could get a lifeline, with public sector behemoths Life Insurance Corporation (LIC) and State Bank of India (SBI) likely to increase their stakes in the beleaguered infrastructure lending company through a rights offering as a means of infusing fresh capital. LIC is IL&FS’ largest shareholder with a 25.34 per cent stake, while SBI, which owns 6.42 per cent, is the seventh-largest stakeholder in the company. The prospect of the two public sector financial institutions raising their stake was discussed in a meeting chaired by Finance Minister Arun Jaitley on Tuesday. Economic Affairs Secretary Subhash Chandra Garg, Reserve Bank of India Deputy Governors Viral Acharya and BP Kanungo, LIC Chairman VK Sharma and SBI Chairman Rajnish Kumar were also present. IL&FS’ top management plans to sell 25 assets worth Rs 300 billion and raise an additional Rs 45 billion by way of a rights issue at Rs 150 a share.
ARTICLE SOURCE: BS