Warburg Pincus, Carlyle consider backing Indian NBFC – report

Sources identified the interested parties to LiveMint and also noted that Ernst & Young has been given the mandate to manage the investment round. Au Financiers' previous round of funding was held in 2010, with the International Finance Corporation and Motilal Oswal Private Equity Advisors among those to commit INR600 million to the company. Motilal was the sole participant in the first round, which raised INR200 million in 2008.

Au Financiers has 141 branches in semi-urban and rural areas, and offers commercial vehicle loans, car loans, small- and medium-sized enterprise (SME) loans, and loans against property. It posted profits of INR420 million for the 2011 fiscal year, three-and-a-half times the previous year's figure. Between April and June 2011, profit was up 133% year-on-year.

The NBFC space is popular among private equity investors, largely for the flexible, rupee-denominated financing options they provide to entrepreneurs who aren't necessarily comfortable selling equity stakes.

KKR set up its own NBFC in 2009, while Goldman Sachs Private Equity, Ashmore Group and Everstone Capital teamed up to create Indostar Capital Finance. It has also been reported that Apollo Global Management and ICICI Venture will launch a joint venture NBFC that will specialize in mezzanine financing, lending money for asset purchases through a combination of debt and equity components.

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• Topics
• South Asia
• Financials
• Expansion
• India
• NBFCs
• Financial Services
• Growth capital
• Warburg Pincus Asia
• The Carlyle Group