First India Promoters To Up Amc Equity

The three principal promoters of First India Mutual Fund plan to raise the equity of the asset management company (AMC) from Rs 11.7 crore to Rs 20 crore.

A C Muthaiah, the sponsor of the fund, currently holds 51 per cent in the fund, while the US-based Metropolitan Life Insurance Company (MetLife) holds 34 per cent and the UK-based Investec holds the balance.

The promoters propose to raise the equity while maintaining their holdings at the same level, which means each will pump in funds in proportion to their existing stakes.

First India fund has remained inactive for almost five years since its inception, except for a minor presence with a tax saving scheme, First India Tax Gain '97 has a Rs 35 lakh corpus and 250-odd investors.

 

"All these years, we remained dormant. It is only after Metlife entered into the company with a stake at end-2000, that we decided to expand operations," Arindam Ghosh, Country Head (Marketing & Sales) told media persons here on Tuesday.

First Leasing Company of India was formerly the joint venture partner of the AMC with Investec of UK, when the company was formed in 1996.

A C Muthaiah acquired the 85 per cent stake held by First Leasing and in 2000, and later transferred 34 per cent stake to MetLife.

The MF is also planning to acquire some ailing funds to expand its base. Without naming the funds, Ghosh said they are considering few options. The fund is launching three open-ended debt schemes, an income fund, a liquid fund and a gilt fund.

All the three will commence from February 6 and close on February 14. Two more open-ended schemes, a fixed maturity income fund and a floating rate fund are also on the anvil, for which the fund will seek the Securities and Exchange Board of India's approval.