Mumbai:
Reliance Capital's deal to sell its entire stake in mutual fund arm to joint venture partner Japan's Nippon Life Insurance will be completed by the end of this month, RNAM CEO Sundeep Sikka said on Monday.
Post stake-sale, Nippon Life Insurance will own 75 per cent stake in Reliance Nippon Life Asset Management (RNAM) for the long term, and the rest will be owned by public, including few marquee investors, Sikka said at the company's annual general meeting.
Sikka said that there would be a change in brand name following the completion of transaction and the company name in due course. However, there will not be any change in management team pursuant to this transaction.
"Reliance Capital's stake sale to Nippon Life transaction to be completed by the end of this month," Sikka said.
Reliance Capital had announced in May that it had signed binding definitive agreements with Nippon Life Insurance of Japan. Under the deal, Reliance Capital will exit the mutual funds business by selling its stake in RNAM to Nippon Life Insurance.
At the time of announcement, both partners held 42.88 per cent stake each in the company, while the rest was with public shareholders
Reliance Capital, which will receive Rs 6,000 crore through sale of its stake, will utilise the amount to pare its debt.
Speaking about corporate rate tax cut announced by the government last week, Sikka said the move will boost earnings by around 10 per cent.
Reliance Capital Ltd, the financial services arm of Anil Ambani-led Reliance Group, has interests in life, health and general insurance, commercial as well as home finance, stock broking, wealth management services, among others.