As much as 6.2 percent equity of Nuvama Wealth Management, making up 22.10 lakh shares were sold through block deals on September 27 with Edel Finance Company and Ecap Equities being the likely sellers in the transaction.
Shares of Nuvama Wealth had a positive reaction to the block deal, surging over 3 percent in opening trade to hit an intraday high of Rs 6,995.90 on the NSE.
While Moneycontrol could not immediately ascertain the parties involved in the transaction, CNBC-TV18 reported that Edel Finance Company and Ecap Equities were eyeing to sell a cumulative 6.4 percent stake in Nuvama Wealth Management via block deals worth around Rs 1,464.8 crore.
As of the end of the June quarter, Ecap Equities held an 8.44 percent stake, while Edel Finance owned 5.18 percent stake in Nuvama Wealth Management.
Follow our market blog to catch all the live action
Meanwhile, the stake sale will also trigger a 75-day lock-in period on any further sales of shares, in a bid to ensure stability in the stock price post this transaction.
Back in late August, Edelweiss Financial Services' founders, Rashesh Shah and Venkatchalam Ramaswamy, also offloaded portions of their stakes in Nuvama Wealth, the exact quantum of which was unknown.
As of the end of the June quarter, Ramaswamy held a 1.79 percent stake in Nuvama Wealth, while Shah's owned 4 percent equity.
In an interview with CNBC-TV18, Shah mentioned that Edelweiss has retained a 14 percent stake in Nuvama to meet its investment needs, having sold just under half of their stake in the company. "Our goal is to keep Edelweiss asset-light and low on debt," Shah explained. He highlighted that the company has reduced group debt by 75 percent over the past few years, bringing it down to around Rs 13,000 to Rs 14,000 crore.
While not in a rush to sell the remaining stake in Nuvama, Shah shared plans to cut holding company debt by half, from Rs 8,000 crore to Rs 4,000 crore. Additionally, Edelweiss aims to finalize the sale of 10-20 percent of Edelweiss Alternatives by the end of October, raising Rs 1,000 crore to Rs 2,000 crore in the process.
Shares of the wealth management company have risen over 38 percent in the past three months and the stake sales can be a part of repositioning on behalf of stakeholders in response to changing market conditions.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
