The Industrial Development Bank of India (IDBI) has exited from the asset management business by divesting its entire 50 per cent equity stake in IDBI-Principal asset management company to its joint venture partner, Principal Financial Group for Rs 94 crore.In a letter to The Stock Exchange, Mumbai (BSE), IDBI said that on March 28, 2003, IDBI and Principal Financial Group Mauritius Ltd (Principal) entered into a ‘sale and purchase agreement’ whereby IDBI agreed to divest its entire stake in IDBI-Principal Asset Management Company.Industrial Development Bank of India and Principal had set up the joint-venture in April 2000 with a 50:50 equity stake. The AMC currently manages 17 schemes with a total corpus of Rs 1,754 crore as on February 28, 2003 and with a investor base of 1,50,000.The company operates around 16 debt schemes, four short-term debt schemes, four equity and debt schemes and five gilt fund schemes. IDBI Principal’s bulk of the corpus amount comes from the income fund, with a size of around Rs 610.76 crore.Established in 1879, Principal Financial Group is a leading provider of a wide range of financial products and services to businesses and individuals, including asset management, retirement services, life and health insurance and mortgage banking. Through wholly-owned companies and joint venture partnerships, Principal Financial Group provides a broad range of financial services and expertise to more than 13 million customers in 14 countries around the world.Earlier, IDBI-Principal was the first private sector company to tie up with the department of postal services to sell mutual funds (MFs) through the postal network. Currently, IDBI-Prinicpal is present at 200 post offices around India, selling MFs units to retail investor. The AMC has also been instrumental in bringing the certified financial planners programme to India, wherein the concept of ‘right-selling’ is being promoted.
