Canbank Investment Management Services, which manages Canbank Mutual Fund, is close to striking a deal to buy out the schemes of GIC Mutual Fund.
The other players looking at GIC Mutual include LIC Mutual Fund, UTI Mutual Fund and SBI Mutual Fund. The US-based George Soros holds a 40 per cent stake in GIC Asset Management Company.
"We are actively considering it and the process is definitely on," Canbank MF managing director N R Ramanujam said.
Canbank Mutual Fund manages assets of around Rs 1,900 crore (Rs 19 billion) through 14 schemes, of which 12 are open-ended.
Thomas Panamthanath, chief executive of GIC Mutual Fund, said, "It is an ownership issue, and the General Insurance Corporation will decide on it."
Incidentally, both LIC MF and UTI MF are learnt to have conducted due diligence of GIC MF, which has around 40 employees and a corpus of Rs 260 crore (Rs 2.6 billion), of which around 80 per cent is in equity assets.
It has seven open-ended and two close-ended schemes. GIC Fortune 94 is its largest scheme with assets of Rs 55 crore (Rs 550 million), and is among its best performers.
Next is GIC Balanced, with a portfolio of Rs 47 crore (Rs 470 million), while GIC Growth Plus-II manages Rs 25 crore. The close-ended schemes will mature in 2005.
GIC, the parent organisation, had decided long ago to quit the mutual fund business and focus on its core reinsurance business.
While GIC MF was among the first public sector companies to launch asset management operations in India, it failed to keep up the momentum.
GIC Asset Management Company was floated by GIC, GIC Housing Finance, New India Insurance, United India Insurance, Oriental Insurance and National Insurance Company.
Canbank faced problems with Canstar in the late 1990s, but after maintaining a low profile for sometime, the fund house is back in the reckoning and has been launching new schemes.