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Thursday, 22 December 2016 17:00

UTI Confident of IPO in Second half of 2017

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UTI Mutual Fund is on course to go public with an intial share sale in the second half of the year with a valuation of over USD 1 Billion and is also looking at inorganic growth to reclaim the prime position it had enjoyed before the US 64 Scheme went bust in early 2001.

As and when the IPO happens, UTI will be first fund house to be listed in the country.

The IPO will allow partial exit for the nation's oldest fund house's four sponsors-SBI, LIC, BOB and PNB which own 18.5% each in it, while the remaining 26 percent is held by US-based Investments firm T Rowe Price.

"We continue to believe IPO will happen in the second half of 2017. We are awaiting Government go-ahead . Once that is in, we'll appoint merchant bankers and seek SEBI nod,"UTI Managing Director Leo puri told PTI in an Interview.

UTI mutual fund was created after Parliament passed the Unit Trust of India Act in 2002 after the the flagship US 64 scheme went belly up. Post the Act, the then mighty UTI was bifurcated into Specified undertaking of Unit Trust of India(Suuti), which owns almost 11.8 per cent in Axis Bank and UTI asset Management Company

The Baltimore-based T Rowe Price picked up 26 per cent in UTI in Novemeber 2009 by Buying 6.5 per cent stake each from the four promoters for USD 140 Million

We are yet to go in for valuation as it will be discovered by the market. But we are sure of our valuation topping USD 1 Billion. But the exact Valuation will be determined as we go to the market for price discovery,"he said, adding the issue size will depend on our shareholders.

Asked whether the company has sought the Government permission, Puri answered in the affirmative saying,"It has been pending with the government for a long know, but know I hope that it would be coming anytime now

From its hallowed position of No 1 fund house for decades following the US Crisis, UTI has now fallen to a distant sixth slot. As of end-november, its oversead AUM stood at Rs 26,000/- Crore. By average AUM, UTI is the sixth largest with an averge AUM of Rs. 1,29,888/- crore in september 2016

Asked whether UTI, which manages Rs 3 trillion assets including its global fund, has come out of the US 64 crisis, Puri said, "Of course. In the past two-three years we've come a long way" and that it is also looking at faster growth through acquisitions.

"The MF market is at an inflection point and we are keen to utilise the opportunity for faster growth. After the IPO we will be looking at inorganic growth. In fact, we hope to utilise a good portion of the IPO proceeds to faster growth, which could be driven by acquisition,"Puri said.


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