Muthoot Fincorp seeks up $115m through PE stake sale

"A lot of private equity players and strategic investors are showing interest in picking up stakes in our company. The money will be utilized to fund our expansion plans over the next year. We are looking for a pan-India presence and accordingly will be adding 1,000 more branches by March 2012," said Thomas John Muthoot, chairman and managing director, The Business Standard reported.

Muthoot Fincorp has around INR65 billion under management and 1,700 branches nationwide, offering mortgages, auto financing, investment products and advisory services as well as gold loans.

It was reported last August that the company was seeking to raise INR10 billion through the issue of listed retail non-convertible debentures. At the time, it had already generated INR9 billion by selling a 13% stake through an IPO. Abu Dhabi Investment Authority, Matrix Partners, Kotak Private Equity and Baring India Private Equity came on board as pre-IPO investors, taking a 7% holding.

NBFCs have become popular among private equity firms. Goldman Sachs Private Equity, Ashmore Group and Everstone Capital teamed up to create Indostar Capital Finance. In July, it was reported that Apollo Global Management and ICICI Venture would launch a joint venture NBFC that will specialize in mezzanine financing, lending money for asset purchases through a combination of debt and equity components.

KKR set up a NBFC in 2009 and uses it as a platform for offering local currency debt products to entrepreneurs that don't need or want to sell equity stakes.

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Save this article  
• Send to  

• Topics
• South Asia
• Financials
• India
• Financial Services
• KKR
• Goldman Sachs
• Everstone Capital