Bandhan-led group to buy IDFC AMC for Rs 4,500 crore; GIC and ChrysCapital part of team

A consortium, led by Bandhan Financial Holdings (BFHL), the holding company of Bandhan Bank, will acquire IDFC Asset Management Co Ltd, for Rs 4,500 crore. The AMC manages mutual fund assets worth Rs 1.25 trillion.

The BFHL consortium includes Lathe Investment Pte, an affiliate of Singapore’s GIC, and Tangerine Investments and Infinity Partners, affiliates of ChrysCapital.

While BFHL will hold 60% in the AMC, GIC and ChrysCapital will hold 20% each.

The boards of IDFC Ltd and IDFC Financial Holding Company approved the sale on Wednesday. The proposed transaction is subject to requisite regulatory and other approvals.

IDFC said the agreement envisages continuity of the current management team and investment processes at IDFC AMC, helping unitholders benefit from consistency in the investment approach IDFC AMC is reputed for. “This will be supplemented well 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 statement said.

Anil Singhvi, chairman of IDFC Ltd, said the transaction is a significant milestone in the plan of unlocking value. “We have achieved signing of the deal within six months of the board’s decision to divest, which further demonstrates IDFC Board’s commitment to consummate the merger of IDFC Limited and IDFC Financial Holding Company with IDFC First Bank”, he said.

Karni S Arha, managing director, Bandhan Financial Holdings, said, “We believe 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. The acquisition of IDFC AMC provides us with a scaled-asset management platform, with a stellar management team and a pan India distribution network.”

Arha told reporters that the asset management industry has been growing at around 16-17%. “The acquisition fits with Bandhan group’s plan to explore other financial services and we will continue this journey.”

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