T D Waterhouse, Aig In Race To Be Tata Amc Ally

The Tatas have identified insurance major American Insurance Group (AIG) and international broking firm T D Waterhouse (TDW) group, among others, as possible joint venture partners for its mutual fund arm, Tata Asset Management Company (TAMC). The group will shed up to 50 per cent in the AMC in favour of the shortlisted company.

Tata AMC managing director K N Atmaramani declined to comment. T D Securities, country head (India), Ajai Bambawale, said, "T D Waterhouse at some stage does want to get into asset management, but I am not at liberty to comment on who these partners are. At this stage we are nowhere near a transaction. Its too preliminary to comment."

 

Synergies could emerge out of a tie-up with T D Waterhouse which is a broking major worldwide. It is already a partner in Tata Finance Securities, a subsidiary of Tata Finance for ebroking. TDW is one of the largest discount brokers globally which has leveraged technology to its benefit, providing online investing services and related financial products.

The Tatas too have in place a joint venture with AIG for insurance. Internationally, it is common practice for companies to have the same partner for insurance and asset management. This practice is followed in India too. For instance, financial institution ICICI Ltd has a joint venture with Prudential for both asset management and insurance. Similarly, HDFC has a partnership with Standard Life for both these activities.

Industry sources, however, said the final tie-up may be with a third partner who is neither into insurance or broking.

The Tata group is also in the process of obtaining clearance from the Reserve Bank of India to acquire 20 per cent in TAMC from Dresdner RCM Global Investors who have expressed their intention to exit the company. The Foreign Investment Promotion Board's approval for the transaction has come through.