Bank of India gains over 2% on fundraising plans

“BOI is looking to sell 27 per cent and retain 2 per cent in the life insurance venture.”

Shares of Bank of India advanced over 2 per cent after reports said the lender is looking to sell 27 per cent in Star Union Dai-ichi Life Insurance Company to raise around Rs 1,200 crore, valuing the company at around Rs 3,800 crore.

It is also looking to offload stakes in Bombay Stock Exchange (BSE), NSDL and Equifax to raise a total of Rs 1,800 crore, exiting non-core businesses and raising funds that can shore up the lender’s equity capital, ET reported.

“BOI is looking to sell 27 per cent and retain 2 per cent in the life insurance venture,” ET reported quoting the executive. “This will help us raise capital by offloading stake in non-core assets. We are looking to raise a total of Rs 1,800 crore by selling non-core assets held in various companies.”


It had floated the request for proposal earlier this year but did not receive bids eligible for sale. Star Union Dai-ichi Life Insurance is a joint venture (JV) of Bank of India, Union Bank of India and Dai-ichi Life.

Bank of India is the largest Indian shareholder with 28.96 per cent stake in the joint venture, while Union Bank of India owns 25.10 per cent and Daiichi Life 45.94 per cent. In 2016, when the foreign direct investment limit was raised, Daiichi had bought 18 per cent from Bank of India, valuing the company at Rs 3,000 crore. The laws allow foreign shareholders to own up to 49 per cent in Indian insurance companies.

The shares of the lender closed 0.42 per cent higher at Rs 71.30 on BSE.
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