IndoStar Capital Finance Limited’s stock surged 6.51 per cent to ₹321.30 as of 10:12 AM IST on September 20, 2024, following the announcement of the sale of its subsidiary, IndoStar Home Finance Private Limited (IHFPL), to WITKOPEEND B.V., an affiliate of BPEA EQT Mid-Market Growth Partnership.
The deal, valued at ₹1,750 crore on a fully diluted basis, was approved by IndoStar’s board on September 19. EQT plans to invest an additional ₹500 crore into IHFPL upon or shortly after the transaction’s closure.
The sale is subject to regulatory approvals, including from the Reserve Bank of India, as well as lender consents and shareholder approval. IndoStar aims to use the proceeds to accelerate growth in its core businesses of Vehicle Finance and Small Business Loans.
As of June 30, 2024, IHFPL operated 121 branches across 8 states with an Assets Under Management (AUM) of ₹2,395 crore and an employee base of 1,029. The average loan ticket size stood at ₹9 lakh.
Daiwa Corporate Advisory India and Ambit Private Limited served as financial advisors to IndoStar for this transaction.