Bhavnani to decide fate of Bankinter

What began as small investments in stocks about 10 years ago has pushed investor Ramchand Bhavnani to an enviable position today where he can decide the fate of Spain's fifth largest bank Bankinter.

Bhavnani, an unknown name till a few years ago, has raised his holding in the bank to over 14%. His rise, which also earned him a director seat on the Bankinter board in 2005, holds even more significance as Spain is a country where large businesses are mostly owned by powerful families and an intricate network of cross-holdings.

The Spanish lending giant said in a regulatory filing that Bhavnani, the second-largest shareholder, now owns 14.08% stake worth about $900 million.

The 63-year old Sindhi businessman, who had moved to Hong Kong from Mumbai long back before moving to the Spanish territory of Canary Islands, has been consistently raising his stake in Bankinter - from about 6% in 2003 to 12% in October 2006 and to 13.6% last week.

His growing stake has stirred speculations that the Spanish bank could soon become an acquisition target, and Bhavnani could reap huge gains from the sale of his stake in Bankinter, currently controlled by the Boltin banking dynasty.

Bhavnani, however, is unlikely to favour a potential sale to some Indian entity. The India-born investor said in an interview last month that he would prefer a possible sale to a Spanish firm and not a foreign bank.