Friday, February 4, 2005
State Bank acquires 51% in Mauritius bank
Our Banking Bureau / Mumbai February 04, 2005
State Bank of India (SBI) has finalised the acquisition of 51 per cent equity stake in Indian Ocean International Bank Ltd (IOIB), Mauritius.
Essentially a retail-focused bank with assets of $1 billion, IOIB is SBI’s first acquisition overseas. SBI today informed the Bombay Stock Exchange (BSE) that it has finalised the acquisition of majority holding along with management control.
The formalities will be completed tomorrow, and the Mauritius-based bank will give SBI a foothold into Africa. The acquisition has been made for a sum less than $10 million. Chairman A K Purwar was not available for comment.
However, SBI has been talking of expanding its overseas operations through acquisitions in Africa and east Asia by the end of March 2005.
It has already raised $ 400 million through issue of medium-term bonds. The bank will raise an additional $ 600 million to fund overseas acquisitions.
SBI intends to take over the bank at a later date, and is likely to merge IOIB with its own subsidiary there — SBI International Mauritius Ltd.
SBI has a network of 52 offices/branches spanning across 31 countries. The bank has carved a niche for itself in Euroland with branches strategically located in Paris, Frankfurt and Antwerp. It also has a branch in New York.
International operations contributed Rs 156.85 crore to the bank’s bottomline in financial year 2003-04, against Rs 128.7 crore in the preceding fiscal.
The bank’s international presence is supplemented by a group of overseas and NRI branches in India and correspondent links with over 700 leading banks of the world. SBI’s offshore joint ventures and subsidiaries enhance its global stature.