Govt looking for strategic partner for UTI-MF: FinMin

Government today said it is scouting for strategic investors for UTI-MF who will help the company raise funds and become more competent.     

"UTI-MF is doing well...But a little shackled...They want to compete with other players in the market," Finance Minister P Chidambaram told reporters here.     

"We are looking for some strategic investors to be brought into UTI-MF without diluting the majority stake of the three banks and LIC," Chidambaram said.     

The three banks are State Bank of India, Punjab National Bank and Bank of Baroda.     
Chidambaram also said there was a review of Special Undertaking of UTI which would be wound up by March 31, 2009.     

SUUTI has already redeemed Rs 21,000 crore of funds by March 31, 2007 to its investors, he said.     

In the current year, they have already redeemed Rs 6,800 crore under US-64. The process would be completed by March 31, 2009, he said.

The residual would go back to government.     

UTI Asset Management Chairman and Managing Director, U K Sinha, said the company was facing challenges from other bigger players in the mutual fund industry.

The inclusion of a strategic partner would make the company more competent in the industry.     

"We discussed the need to bring in a strategic partner to the company who would act as more than a pure financial investor. The expertise which the partner will bring in, will help UTI MF to accelerate its growth," he said.     

On its IPO plan, Sinha said the approval received from Sebi has already lapsed and the company would now have to apply afresh.     

"We are waiting for the right market conditions, both in India and internationally, before making a fresh application (for IPO) to Sebi," Sinha said.