NEW DELHI: A consortium of Bandhan Financial Holdings, GIC and ChrysCapital will acquire IDFC Asset Management Company for Rs 4,500 crore in one of the largest deals in the country's asset management space.
The deal is subject to receipt of necessary regulatory approvals and customary closing conditions, according to a regulatory filing.
IDFC Ltd and the consortium have entered into a definitive agreement to acquire IDFC Asset Management Company Limited (IDFC AMC) and IDFC AMC Trustee Company Limited.
The deal will be for a consideration of Rs 4,500 crore, the filing said.
"This is a highly tracked acquisition and will be the largest deal in the Indian asset management industry to date," it added.
The agreement envisages continuity of the current management team and investment processes at IDFC AMC.
This will be supplemented by Bandhan's brand as well as GIC's and CC's international network and experience which will aid IDFC AMC in further cementing its position in the asset management industry and propel further growth, the filing said.
"This transaction is a significant milestone in our plan of unlocking value and the consideration demonstrates strong position of IDFC AMC in the Indian mutual fund space.
"We have achieved signing within 6 months of the board's decision to divest, which further demonstrates IDFC Board's commitment to consummate the merger of IDFC Ltd and IDFC Financial Holding Company with IDFC First Bank," Anil Singhvi, Chairman of IDFC Limited said.
The Bandhan consortium with its strong brand and resources will further strengthen distribution of products and improving overall experience for IDFC AMC's investors and distributors, he said.
Karni S Arha, Managing Director, Bandhan Financial Holdings Limited, said, "Bandhan has always focused on financial inclusion and making formal financial services available to the masses. We believe that the asset management industry will be one of the fastest growing segments in the Indian financial services industry and hence has been identified as a key vertical in our future growth plans."
He said the acquisition of IDFC AMC provides the company a scaled up asset management platform, with a stellar management team and a pan India distribution network.
"IDFC AMC could benefit significantly from the Bandhan brand and continue strengthening its position in the asset management industry," he added.
Choo Yong Cheen, Chief Investment Officer of Private Equity, GIC said: "GIC is pleased to continue our partnership with the Bandhan group and ChrysCapital through this new investment in IDFC AMC. We believe IDFC AMC is in a favourable position to capture the strong secular growth in the currently under-penetrated Indian asset management industry."