Blackstone buys India's Aadhar Housing Finance
The Blackstone Group has agreed to buy Indian affordable housing lender Aadhar Housing Finance for a reported INR27 billion ($378 million).
Dewan Housing Finance (DHFL), one of Aadhar’s shareholders, said in a filing that Blackstone will acquire its entire 9.2% stake along with shares held by other investors, including multinational conglomerate Wadhawan Global Capital (WGC). WGC owns a 70% stake in Aadhar, and is also the controlling shareholder in DHFL.
The International Finance Corporation (IFC) held a 16.9% stake in Aadhar as of March 2018; it has not indicated whether it will exit its holding. The size of the transaction was not disclosed, but multiple local media sources put it at INR27 billion.
Aadhar was launched in 2010 by DHFL and IFC to provide home loans for low-income borrowers, and merged with DHFL’s affordable housing subsidiary DHFL Vysya in 2017. It has more than 300 branches in 20 states and claims to have served over 125,000 customers, with a loan book of around INR1 billion.
According to Aadhar’s most recent annual report, its revenue for the year ended March 2018 came to INR8 billion, up from INR2.1 billion the year before. Over the same period, net profit rose from INR232 million to INR997 million.
The Aadhar sale comes as DHFL and WGC struggle to address the fallout of fraud accusations that first came to light last week. An Indian investigative news portal alleged that the Wadhawan family that controls WGC used DHFL to illegally divert around INR310 billion in public funds, which were then used to acquire a variety of assets overseas.
DHFL’s stock has plunged since the accusations were published; the share price closed at INR111.20 on February 1, down from the INR209.10 closing price of January 25. The stories aggravated an already-grim half-year for the company, which was trading around INR611 in mid-September but, like other non-bank lenders, suffered from a crisis in investor confidence following a string of defaults by Infrastructure Leasing & Financial Services and the lender’s subsequent bankruptcy.
More on South Asia
Latest News
Asian GPs slow implementation of ESG policies - survey
Asia-based private equity firms are assigning more dedicated resources to environment, social, and governance (ESG) programmes, but policy changes have slowed in the past 12 months, in part due to concerns raised internally and by LPs, according to a...
Singapore fintech start-up LXA gets $10m seed round
New Enterprise Associates (NEA) has led a USD 10m seed round for Singapore’s LXA, a financial technology start-up launched by a former Asia senior executive at The Blackstone Group.
India's InCred announces $60m round, claims unicorn status
Indian non-bank lender InCred Financial Services said it has received INR 5bn (USD 60m) at a valuation of at least USD 1bn from unnamed investors including “a global private equity fund.”
Insight leads $50m round for Australia's Roller
Insight Partners has led a USD 50m round for Australia’s Roller, a venue management software provider specializing in family fun parks.