New Delhi: Domestic mutual funds, including Reliance, SBI and ICICI Prudential MFs, purchased shares worth an estimated Rs 1,000 crore in Tech Mahindra -- outpacing foreign investors as well as Indian insurers in buying shares put on block by British Telecom, a promoter in the IT firm.
The UK-based global telecom giant BT group yesterday sold shares worth a total amount of Rs 1,395 crore, accounting for a 14.1 percent stake in Tech Mahindra, while pruning its holding in the Indian IT firm to 9.1 percent.
BT said last night that shares were sold to institutional investors, but did not disclose the name of the buyers.
However, the share dealing data with the stock exchanges show that the shares were acquired by more than 20 investors, which included domestic mutual funds and life insurance companies, as well as foreign investors.
While domestic fund houses acquired shares worth an estimated Rs 1,000 crore, the life insurers bought equity worth less than Rs 100 crore. The foreign investors purchased shares worth close to Rs 300 crore.
Overseas investors included Merrill Lynch, Credit Suisse, Copthall Mauritius Investment, Blackrock, a Norway government fund, Master Trust Bank of Japan, Kuwait Government Investment Authority and New Vernon (a India-focussed US based fund).
Among mutual fund investors, shares were bought by Birla, ICICI Pru, Reliance, SBI, Sundaram BNP and DSP Blackrock MFs. The insurers that acquired the shares were HDFC Standard Life, SBI Life, IDBI Life, Birla Insurance and Reliance Life. The acquirers also include Indus and Kotak UK funds.
The transactions happened through close to 40 bulk and block deals on the BSE and NSE, and were managed by global investment banking giants JP Morgan and Credit Suisse.
BT sold a total of 17.9 million shares at an average price of Rs 777.73 per share. Interestingly, most of the life insurance companies purchased the shares at an average price of Rs 775 apiece, lower than some domestic and foreign funds.
BT has said it would consider further share sale in future, but Tech Mahindra would remain a key supplier for it.
BT Group is a co-promoter of Tech Mahindra, with the other being Indian business conglomerate Mahindra and Mahindra (M&M) Group. BT and M&M had set up a joint venture company in 1986 to provide IT services to the telecom sector and this venture later became Tech Mahindra.
M&M has close to 48 percent stake in Tech Mahindra.
Prior to yesterday's stake sale, BT had a 23.16 percent holding in Tech Mahindra, while previously it had sold a 5.5 percent stake in the IT firm to another promoter M&M in 2010.
Tech Mahindra shares fell by over five percent yesterday, after hitting an early morning low of Rs 775 -- a price at which many bulk and block deals were struck. The shares rose about 1 percent today to close to Rs 800.