Central Bank of India has begun the process of selling the 8.34% stake it holds in Infrastructure Leasing and Financial Services Ltd (IL&FS) in order to shore up capital in the face of rising bad loans and ahead of stricter provisioning norms. The bank has appointed Axis Capital, the investment banking arm of rival Axis Bank, to identify a buyer for the holding in India’s largest unlisted infrastructure developer and lender. Probable buyers could be existing investors in IL&FS such as Japan’s Orix and Abu Dhabi Investment Authority. The sale could fetch around Rs 3,000 crore, for the bank. The other large shareholder of IL&FS is Life Insurance Corporation of India. HDFC, Abu Dhabi Investment Authority, State Bank of India and IL&FS Employees Trust are the other shareholders.
