SIDBI to set up overseas venture capital fund

MUMBAI, FEB. 5. The Small Industries Development Bank of India (SIDBI) will set up an overseas venture capital fund (OVCF) of $50 million focussing on information technology and knowledge based sectors.

``A memorandum of understanding has been signed with IVG of Mauritius and at present due diligence is being carried out", SIDBI's new chairman and managing director, Mr. P. B. Nimbalkar, told newspersons here today.

The Centre and the Reserve Bank of India have approved the fund and it was expected to be operational in the next two to three months, he added. In the first phase, SIDBI would put in $20 million while IVG would contribute $10 million, he said.

The OVCF would have a three tier strategy namely at the regional, national and international level, Mr. Nimbalkar said adding, SIDBI had 12 regional funds operating in 10 States in the country.

IDBI, which owned 100 per cent in SIDBI, has recently offloaded around 51 per cent stake in the latter to public sector banks and financial institutions at Rs. 30 per share (premium of Rs. 20), he said.

He said there was a provision to transfer the balance 49 per cent into redeemable preference capital. This, however, `will take sometime'.

Life Insurance Corporation, General Insurance Corporation and its subsidiaries, IIBI, Exim Bank and National Bank for Agriculture and Rural Development (Nabard), together, would subscribe to shares worth Rs. 80 crores (face value) while it was Rs. 54 crores in the case of SBI group, Mr. Nimbalkar said.

- PTI

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