The offer comes in the wake of the acquisition of IDFC Mutual Fund by a consortium of Bandhan Financial Holdings Ltd, sovereign wealth fund GIC and private equity fund ChrysCapital.
New Delhi:
Capital market regulator SEBI recently issued a proposal to allow private equity (PE) funds to sponsor mutual fund houses. PE funds can contribute to the growth of the industry by providing strategic guidance and bringing in qualified talent. The offer comes in the wake of the acquisition of IDFC Mutual Fund by a consortium of Bandhan Financial Holdings Ltd, sovereign wealth fund GIC and private equity fund ChrysCapital.
In a consultation paper, a working group constituted by SEBI has suggested eligibility criteria for allowing private equity funds to sponsor mutual fund houses. The working group has also suggested further strengthening of these criteria so that only high quality institutions are found eligible.
At present, if an institution has 40 percent or more stake in a mutual fund, then it is considered a sponsor.
The Securities and Exchange Board of India (SEBI) has sought public comments on the proposals till January 29.
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