Indian regulator nixes acquisition of PE-backed Sharekhan

The FIPB made the decision at its May 20 meeting, according to an announcement. BNP had made its buyout offer last July, reportedly proposing to pay INR22 billion ($343 million) for 100% of Sharekhan's shares, other than those owned by Human Value Developers, a non-banking finance company owned by members of Sharekhan's senior management. BNP's offer to buy a 100% stake in Human Value Developers was also rejected.

The deal would have provided an exit for Sharekhan's PE backers, which include Baring Private Equity Asia, IDFC, Samara Capital and Rohatyn Group. FIPB has already blocked a previous deal among existing shareholders, rejecting Baring's proposed buyout of IDFC's stakes in Sharekhan and Human Value Developers last May.

Sharekhan was launched in 1995 under the name SSKI Investor Services, and raised INR520 million from the Carlyle Group, HSBC Private Equity Asia (now Headland Capital Partners) and Intel Capital in 2000.

In 2006 General Atlantic bought Carlyle's stake along with freshly issued shares for $32.4 million. IDFC acquired a 10% stake in 2007, at the same time Citi Venture Capital took a 75% stake. Rohatyn purchased Citi Venture Capital and its stake in 2013. Baring has a 12% holding, which it bought in 2008.

BNP, headquartered in Paris, has operated in India since 1860 and currently has branches in eight major cities, offering a wide range of financial services covering corporate and institutional banking, transaction banking and wealth management. The bank had planned to use Sharekhan as a platform to expand the financial products and services it offers in India.

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• Topics
• South Asia
• Financials
• Regulation
• Trade sale
• India
• IDFC Private Equity
• The Rohatyn Group
• Baring Private Equity Asia
• Samara Capital
• Headland Capital Partners
• Exit