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The Azim Premji Trust, which was gifted 213 million shares of Wipro in December 2010 (valued then at 8,846 crore), will sell 35 million of them, the first time it is doing so since the endowment was created.
The money will be used to fund the expansion of Azim Premji Foundation, which is working to improve teaching and learning in some of India's most backward districts. It will also help the Azim Premji University scale up its teaching and research work.
"The principal amount that we get from the sale could be used to directly fund the foundation or we could just put in the income we generate from these funds. We will probably do a combination of both," the trust's chief endowment officer KR Lakshminarayana said.
Premji, 66, is likened to Bill Gates and Warren Buffett for his generosity in pledging a substantial portion of his nearly $16-billion fortune to improve the standard of education in India. The foundation was set up more than a decade ago with an initial contribution of about to 1,000 crore worth of Wipro shares.
The sale by Trust, which owns 8.66% of Wipro's outstanding shares will help the promoter group bring down its shareholding from a little over 79% and closer to the 75% limit for promoters mandated by capital market regulator Sebi. But Wipro officials said the motive for the sale is to fund the foundation.
"We have taken 100 students in the first year and this year we will be taking in the second batch. Our primary constraint has been that we are still in a rented campus so we are not able to expand," Anurag Behar, vice chancellor of the foundation, said.
The university is setting up an 85-acre campus in Karnataka, which will allow it to increase the batch size to about 2,000 in the fifth year of operation, he added. The university is primarily engaged in the education-related training and research.
Citigroup Global Markets, Morgan Stanley India, UBS Securities India and Credit Suisse Securities India will manage the sale process. Wipro's shares closed at 437.15 on the Bombay Stock Exchange on Monday.
http://economictimes.indiatimes.com/markets/stocks/stocks-in-news/azim-premji-trust-to-sell-1530-crore-wipro-shares-to-fund-education/articleshow/12235030.cms?google_editors_picks=true
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