BNP Paribas to acquire PE-backed Sharekhan
French bank BNP Paribas has agreed to acquire Indian retail brokerage Sharekhan from its private equity backers.
The terms were not disclosed, but according to LiveMint, BNP Paribas paid INR22 billion ($343 million) for a 100% stake.
The deal comes three months after India's Foreign Investment Promotion Board (FIPB) rejected a bid by Baring Private Equity Asia to buy IDFC's stake in the company. Baring had included in its offer IDFC's interest in Human Value Developers, a non-banking finance company (NBFC) owned by senior Sharekhan management
Launched in 1995 as SSKI Investor Services, Mumbai-based Sharekhan claims to be India's leading independent retail brokerage, offering broking solutions across all asset classes. The business is estimated to have about 1.2 million private clients and a 7% market share in terms of number of accounts.
In 2000, the company raised INR520 million ($11.3 million) from The Carlyle Group, HSBC Private Equity Asia (now Headland Capital Partners) and Intel Capital. Then in 2006, General Atlantic paid $32.4 million for Carlyle's stake, along with freshly issued stock, gaining it a 15% holding in all.
"Sharekhan will serve as a platform through which the group can offer a comprehensive range of products in India, from pure brokerage to asset based investment services such as mutual funds and savings products," said Joris Dierckx, country head at BNP Paribas India, in a statement. "The purchase of Sharekhan is a unique opportunity for us to build on our achievements in the Indian market and to further expand our business in India."
Paris-headquartered BNP has been in India since 1860 when it was one of the first foreign banks to enter the country. Today it has branches in eight major cities and offers a wide range of financial services covering corporate and institutional banking, transaction banking and wealth management.
The transaction is still subject to regulatory approvals.
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