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Warburg’s Future Capital offer faces delays

  • Susannah Birkwood
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Warburg Pincus’ offer to buy a 26% stake in India's Future Capital Holdings (FCH), the financial services unit of the Future Group, has been delayed despite reports that the $100-125 million deal was finalized last month.

The US private equity firm's open offer to FCH's public shareholders has been put back while the relevant parties obtain the necessary regulatory approvals. The open-offer period had been tentatively programmed to close on August 7.

Last month, Warburg, which joined the race to invest in the firm in May, agreed to pay INR162 per share for the 26% stake - a 14% premium to the price when the sale was announced on June 4.

It also snapped up the 53.67% stake held by Kishore Biyani-controlled Future Group, which had been considering its exit options for the past two years.
Law firm AZB & Partners was mandated to conduct the second phase of due diligence on FCH.

Warburg's main competitor through the process appeared to be Hyderabad-based Deccan Chronicle Holdings, which previously tried to acquire the asset but failed due to a lack of funds.

Last November, The Blackstone Group and Bain Capital were both identified as potential acquirers of the company, having entered into discussions over pricing and whether to involve both funds.

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