Kotak Mahindra Bank share price up by 1%, after Company acquires Sonata Finance in ₹537 crore deal

Kotak Mahindra Bank announced the successful acquisition of Sonata Finance Private Limited ("Sonata"). This acquisition, finalized today for a total consideration of approximately Rs. 537 crore, marks Kotak Mahindra Bank's full ownership of Sonata.

The stocks of Kotak Mahindra Bank were trading in green up 1.15 per cent at ₹1796, on March 28, at 1:33 pm on BSE. The Company's stock is around 12 per cent down from its 52-week high of ₹2,063. Kotak Mahindra Bank enjoys a market capitalisation of ₹3,57,015 crore.

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As previously communicated in February 2023 and October 2023, the Bank had expressed its intention to acquire Sonata. Now finalized, this acquisition brings Sonata's extensive microfinance network under the Kotak Mahindra Bank umbrella.

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Sonata, a Non-Banking Finance Company – Micro Finance Institution (NBFC-MFI) registered with the Reserve Bank of India (RBI), operates across 10 states through 549 branches. As of December 31, 2023, it boasted an impressive Asset Under Management (AUM) of approximately Rs. 2,620 crore.

Earlier in February 2024, Kotak Mahindra Bank decided to give up its majority stake in the general insurance business. The private sector lender Kotak Mahindra Bank announced that Zurich Insurance will acquire a 70 per cent stake in the bank’s general insurance arm, Kotak Mahindra General Insurance, for ₹5,560 crore, in a single tranche.

In November 2023, the private lender had announced the sale of a 51 per cent stake in Kotak Mahindra General Insurance to Zurich Insurance for ₹4,051 crore through a combination of fresh capital infusion and share purchase. This was supposed to be followed by a 19 per cent stake sale within a period of three years.