Idbi Helped Swing Fis To Alcan'S Side

The Industrial Development Bank of India (IDBI) may have played a significant role in persuading the Unit Trust of India (UTI), General Insurance Corporation (GIC) and Life Insurance Corporation (LIC) to bid in favour of Alcan.

The three institutions yesterday decided to sell their holding amounting to 36.1 per cent holding in Indal to Alcan at the price of Rs 200 per share.

Sources said while IDBI was strongly in favour of selling to Alcan, ICICI was backing Sterlite Industries.

Senior FI sources said unlike ICICI IDBI was not in favor of selling off the FIs holding in Indal to Sterlite Industries. "This was clear in an analytical study that ICICI did on Sterlite which projected higher cash generation of Sterlite assuming it takes a large stake in Indal, while IDBI's figure was much lower," said sources. "IDBI's figure was half of ICICI, ," he added.

 

IDBI being the apex financial institution argued in favour of Alcan over Sterlite based on its projections, said senior FI sources. Alcan's higher price also clinched the issue in its favour.

While IDBI does not have any stake in both Sources stated that ICICI has large exposure in Alcan to the turn of over Rs 400 crore while IDBI's exposure is in the region of Rs 50 to 60 crores, said sources. Institutions, who hold major stakes in indal are LIC and UTI, who between them hold 32 per cent. GIC holds around four per cent, FIIs hold five per cent and GDR holders 12 per cent.