Shares of SBI Life Insurance Company tumbled over 5 per cent on the Bombay Stock Exchange (BSE) on Tuesday after BNP Paribas Cardif announced to sell 2.5 per cent stake in the insurance company for Rs 1,625 crore.
BNP Paribas Cardif, one of the promoters of SBI Life Insurance, proposes to sell up to 2.5 crore shares of face value of Rs 10 each, representing 2.5 per cent of the equity share capital of the company, through offer for sale (OFS) mechanism.
SBI Life Insurance is a joint venture life insurance company between State Bank of India, the country's largest bank, and French multinational bank BNP Paribas Cardif.
As on March 31, 2019, BNP Paribas Cardif held 7.7 per cent shares in the private insurance company, while State Bank of India owned 62.10 per cent stake.
The floor price has been fixed at Rs 650 per share for the two-day OFS which opened on June 25, SBI Life Insurance Company said in an exchange filing on Monday. The floor price is lower than Monday's closing price of Rs 710.45 apiece on the BSE.
Weighed down by the development, SBI Life Insurance Company share price declined as much as 5.51 per cent to hit an intra-day low of Rs 669.25 on the BSE. Paring some of losses, the stock closed trade at Rs 674.90, down 5 per cent.
On the National Stock Exchange, the shares of SBI Life closed trade at Rs 680, down 4.31 per cent. During the day's trade, the scrip touched an intra-day low of Rs 671.15 after opening lower at Rs 675.
On Monday, SBI Life shares hit a 52-week high of Rs 714 on the BSE in intra-day trade in otherwise subdued market.
On March 29, BNP Paribas Cardif had offloaded 5 crore shares in the company through a block deal for Rs 2,889 crore. BNP Paribas sold its stake in the company through the open market at average price of Rs 577.93 per equity share. On the same day, Canada Pension Plan Investment Board purchased 2 crore shares at an average price of Rs 577.50 per shares.
Edited by Chitranjan Kumar