NEW DELHI: Non-banking finance company IFCI Ltd agreed to buy IDBI Bank’s 19% stake in Stock Holding Corporation of India Ltd (SHCIL), the country’s top custodial and depository service provider, for Rs 340 crore and help ease the pressure on the Mumbai-based lender’s bottomline.

Sources familiar with the development told TOI that IFCI will buy the shares at Rs 851 each, which is a 4% premium over what it paid to ICICI Bank in August 2011 to acquire its 16.9% holding. Once the transaction is complete, the NBFC will become a majority shareholder in SHCIL. On March 15, TOI was the first to report about the transaction.

IFCI will, however, end up paying an additional quarter percentage point as stamp duty since Stock Holding Corporation’s shares were surprisingly not in dematerialized form.

The deal coming days before the close of the financial year, will provide much-needed relief to IDBI Bank, which is battling rising bad debt, which is now hurting its profitability. The bank has decided to sell its shares in SHCIL and ratings agency Care in a bid to raise resources and book some gains.

The decision to sell the so-called non-core holdings come months after IDBI Bank sought to take charge of Stock Holding Corporation but had to abort its bid after the government, which holds a majority stake in the bank, turned down the proposal. IDBI Bank had planned to acquire take over the company and use its over 200 office as bank branches, a move that was opposed by IFCI and was finally trashed by the finance ministry.

IDBI Bank had approached exiting shareholders, including LIC and the Specified Undertaking of UTI, which hold 16.9% each. IFCI being the largest shareholder, with 34% stake, was backed by the government in its bid to raise its stake in SHCIL.