Shriram Asset Management to launch open offer

Move is part of plan to renew MF business

Shriram Asset Management Company Limited (SAMC), the BSE-listed arm of Chennai-based Shriram Group, is set to launch an open offer as part of a plan to renew its mutual fund (MF) business.

The company, which once carried out the asset management activities of Shriram Mutual Fund, has been inactive in the segment for a number of years. The latest move is part of a plan to re-start operations at Shriram Asset Management, according to a group official.

“An asset management team has been put in place… The business is undergoing a reorganisation by which it will now come under Shriram Credit,” said the person.

Shriram Credit Company has entered into an agreement to buy over 40 per cent stake in SAMC. It will pick up 2.67 per cent from R Thyagarajan and 40 per cent from Shriram Transport Finance Co Ltd (STFC), according to a public announcement made by the company.

The transaction has triggered an open offer to acquire 1.56 million shares or 26 per cent additional stake in the company, at a price of Rs 15.60 per share.

The asset management company (AMC) was incorporated on July 27, 1994 and received the certificate of commencement of business on December 5, 1994.

The company received permission from the Securities and Exchange Board of India to act as the AMC of Shriram Mutual Fund in 1994. STFC, which holds 40 per cent stake in SAMC, is the sponsor of SAMC.

STFC is a company which has significant presence in the commercial vehicle financing space. Its corporate office is situated at Mumbai.

All the schemes of Shriram Mutual Fund have been wound up and no new schemes have been launched, says its last annual report (FY12).

The Scheme Risk Guardian’95 has been wound up effective July 7, 2000. The three tax-saving schemes —Tax Guardian’95, Tax Guardian’96 and Tax Guardian’97 — were wound up effective April 30, 2001 and the Interval Fund 97 effective December 1, 2001.

Interestingly, the stock was trading at Rs 35.75 on the BSE, down 3.38 per cent from the previous day’s close.

The open offer is being managed by Vivro Financial Services Private Limited. Further details of the offer are to be made public before May 16, according to the company’s announcement.

THE 'OLD' NEW KID ON THE MF BLOCK

• BSE-listed Shriram Asset Management Company once managed money for Shriram MF in the nineties
• Company has been inactive in asset management for a number of years
• Shriram Group plans to restart MF business
• Puts in place new team, plans re-organisation
• Shriram Credit to purchase 42.67% stake in Shriram Asset Management
• Open offer triggered for another 26% stake