US investor T Rowe Price moves HC over UTI's IPO issue

US investor T Rowe Price has approached the Bombay High Court seeking a direction to the finance ministry and Sebi to prevent four PSUs from stalling the Unit Trust of India's bid to come up with an IPO.

In its petition, T Rowe Price International Ltd, which owns 26 per cent of the UTI Asset Management Company, claimed the four public sector undertakings State Bank of India, Life Insurance Corporation, Punjab National Bank and Bank of Baroda were trying to stall the company's proposed IPO.

The petition, filed in the high court yesterday, has sought for implementation of the Sebi's rules and regulations and to extend the term of UTI's chief executive Leo Puri for another year to see the IPO through.

According to T Rowe Price, the four PSUs, which together own 74 per cent in the UTI AMC, are not in favour of granting Puri a second term.

"In the absence of confirming Leo Puri's appointment for a further period of 12 months, the performance of UTI shall be adversely affected and consequently, the interest of unit holders shall further deteriorate," the petition said.

The petition has also sought a direction to Sebi to ask the four domestic shareholders to bring down their holding in the fund house to 10 per cent each from the present 18.25 per cent.

It claimed that as per a regulatory order issued by Sebi in March this year, no shareholder of one asset management company can own more than 10 per cent in another, and those who own such stakes need to bring them down.

The petition will be placed before a division bench of the high court which is likely to hear it on August 16, according to the high court's website.