India’s Central Bank of India will move out of the housing partnership by selling more than 64 percent of its total stake to the Centrum Housing Finance for Rs. 160 Crore. The bank is going to earn around Rs. 160 Crore from this acquisition.
This is to inform the bank that it has entered into a binding agreement to deduct the entire amount of 64.40 percent ie 1,61,00,000 shares valued at Rs 10 each from Cent Bank Home Finance Ltd (CBHFL), to Centrum Housing Finance, subject to approval. are the regulatory authorities, the Central Bank of India said in a BSE file.
The cost of acquisition according to a separate filing by Centrum Capital which is the parent company of Centrum Housing is around Rs. 160 Crore on a cash basis. A subsidiary of the company, Centrum Housing Finance has entered into a shareholding agreement with the Central Bank of India to acquire the entire bank share in CBHFL which makes up 64.40 percent of CBHFL shares in total, Centrum Capital said in a statement.
The target firm is in the same line of business as the sub-company, which is why this is a strategic acquisition, he adds. Centrum Capital said the agreement was expected to be closed in about two to three months.
CBHFL is a finance and joint venture with four public sector entities – Central Bank of India, National Housing Bank, Specified Undertaking of Unit Trust of India (SUTTI), and also the Housing and Urban Development Corporation.
The company’s assets held at Rs 1,211.70 crore as of September 30, 2020. Total revenue was Rs 65.81 crore. All of its assets and revenue will now become the part of new entity’s assets. The Central Bank of India will earn around Rs. 160 Crore from this acquisition. Presented in nine provinces, the company’s customers include individuals, organizations, associations of persons, companies, societies, and communities.