Mahindra & Mahindra has sold off its entire 3.5 per cent stake in RBL Bank for $77.1 million, the automaker announced on Thursday.
The exit comes weeks after Dubai’s Emirates NBD announced plans to acquire a 60 per cent stake in RBL Bank for $3 billion, which would be the largest cross-border deal in India’s financial sector.
Thursday’s sell-off is said to have earned M&M a 62.5 per cent return on the investment in the bank that it had made in 2023.
At the time of acquiring a stake in the bank two years ago, M&M CEO Anish Shah had said the move was aimed at gaining deeper insights into the banking sector over a seven- to 10-year period, adding that it would be maintained unless a strategic opportunity emerged.
Also Read: Emirates NBD’s takeover of RBL Bank: Employees’ union protests
While analysts questioned the rationale behind the acquisition, since M&M is largely an automobile-focused enterprise, the company later clarified that it had no intention of increasing its holding in the lender.
Meanwhile, the company shares rose 1.5 per cent in early trade on Thursday, while RBL’s shares surged 1 per cent higher.
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