Existing investors General Atlantic and Fairfax India Holdings Corporation will make a partial exit from IIFL Wealth, part of the homegrown financial services firm IIFL Group.
Bain Capital is proposing to acquire 2.2 crore shares constituting 24.98% stake in the company at ₹1,661 per share for a total consideration of ₹3679.95 crore “by way of a share purchase agreement executed on March 30, 2022 with General Atlantic Singapore Fund Pte. Ltd. and FIH Mauritius Investments Ltd,” IIFL Wealth said in a regulatory filing.
The exact shareholding post-acquisition is yet to be disclosed.
The deal will be through Bain Capital’s investment vehicle BC Asia Investments X Ltd. The transaction is subject to regulatory and other customary approvals, the filing added.
As on December 2021, General Atlantic owned 21% in IIFL Wealth, while another 13.64% was held by FIH Mauritius Investments Ltd, a wholly owned subsidiary of Fairfax India Holdings Corporation, owned by Indian born Canandian billionaire Prem Watsa.
In a similar space, Asia-focused PE investor PAG had picked up majority stake in Edelweiss Wealth Management in 2020.
Mumbai-based IIFL Wealth Management is among the leading wealth and alternative asset managers in India with ~$44 billion (around ₹3.3 trillion) in assets (as on December 31, 2021).
Founded in 2008 by first generation entrepreneurs, Karan Bhagat (MD & CEO) and Yatin Shah, (Joint-CEO of IIFL Wealth) the firm offers wealth management, asset management, lending solutions and estate planning services to high net worth and ultra-high net worth individuals, family offices and institutions.
The company has approximately 900 employees and a presence in four major global financial hubs and 23 locations in India.
Its product suite includes alternative investment funds (AIFs), portfolio management services (PMS) and mutual funds (MFs) spanning across asset classes of public and private equity, fixed income, credit solutions and real estate. The wealth manager has been expanding its team making key appointments with heads for its private credit and private equity vertical.
In 2019, IIFL group split into three listed entities — finance, wealth and securities. Fairfax recently made its first partial exit from IIFL Finance.
“Bain Capital’s investment is a testament to our strong leadership franchise in the financial services space, and in our team’s ability to continue to execute and grow the business to scale. We look forward to having them on board,” said Bhagat, Managing Director and Chief Executive Officer, IIFL Wealth Management.
J.P.Morgan acted as the exclusive sell-side financial advisor on the transaction. Axis Capital and NovaDhruva acted as financial advisors to Bain Capital.
US-based Bain Capital was founded in 1984 and currently has a global team of more than 575 investment professionals.
Since inception, the firm has made primary or add-on investments in more than 1,000 companies. It focuses on key vertical industries including healthcare, consumer/retail, financial and business services, industrials, and technology media and telecommunications.
“The Company (IIFL Wealth) is well poised to benefit from secular tailwinds of wealth creation in the economy, greater financialisation, and increasing penetration of formal wealth management. We look forward to working with the team on the next phase of IIFL Wealth’s growth journey,” said Pawan Singh, Managing Director at Bain Capital.
In addition to private equity, Bain Capital invests across asset classes including credit, real estate, public equity and venture capital, managing total assets worth more than $155 billion.
Bain Capital has offices in Boston, Chicago, New York, Palo Alto, San Francisco, Dublin, London, Luxembourg, Madrid, Munich, Guangzhou, Melbourne, Mumbai, Hong Kong, Seoul, Shanghai, Sydney and Tokyo.