Centurion Bank asks Sabre to submit new plan for stake sale

Nisha Das
03 April 2003

Mumbai: The private sector Centurion Bank has asked Sabre Capital Wordwide Inc to submit a fresh proposal for picking up a 26-per cent stake in the bank as the foreign institutional investors (FIIs) of the bank have disagreed on several clauses put forward by Sabre in its current proposal submitted in February 2003.

Following this, the Centurion Bank board has deferred its plans to put up Sabre Capital’s proposal to its board for approval, when it met for the yearend review. Sabre is promoted by Rana Talwar.

“The board did not discuss the Sabre proposal. We still have to take a final view on the issue and might be ready to go to the board possibly by the end of April,” says a senior Centurion Bank official.

Sources close to the development say the proposal in its present form does not appeal to some of the bank’s shareholders. The FIIs — Asian Development Bank, Keppel and IFC — have taken exception to certain points and sought several clarifications from Sabre.

Centurion Bank is in need of tier-I capital to the tune of Rs 150 crore. The bank’s capital adequacy ratio is much below the Reserve Bank of India-stipulated minimum of 9 per cent.

At present, the foreign partners of the bank together hold about 36-per cent stake. Sabre reportedly has been exploring the option of buying a 5-per cent stake from IFC, which currently holds around 10 per cent in the bank.