US fund to pay Rs 501 cr for 5% in Rel Cap

Eton Park, a US-based hedge fund managing over $10 billion worldwide, is buying a 5% stake in Reliance Capital Asset Management for Rs 501 crore. This values the mutual fund at Rs 10,000 crore or 13% of assets under the fund’s management. RCAM will use the proceeds from the stake sale to expand its domestic and international operations, a company press release said, adding that the transaction was expected to be finalised in January 2008.

Reliance Capital said the valuation of the mutual fund arm, following the proposed investment by Eton Park, translates into Rs 400 per share of Reliance Capital. Eton Park was formed in 2004 by three former Goldman Sachs executives.

Read more in The Economic Times article.