INSUBCONTINENT EXCLUSIVE:
MUMBAI: Five entities, including InCred Finance and Vikas Khemani-led Carnelian Capital Advisors, are in the race to buy out finance company
IDFC’s broking business that has likely drawn bids of up to Rs 170 crore.
Dharmesh Mehta of Axis Capital, Equirus Capital, and Responsive
Industries are the other three interested buyers submitting offers to acquire IDFC Securities, said four people in the know
Most of those bids have come in between Rs 130 crore and Rs 170 crore, two out of the four people cited above told ET.
The company posted
sales of Rs 100 crore and net profit of Rs 23 crore for the year ended March 31, 2018
Its net worth was Rs 169 crore.
IDFC, Mehta, Khemani and InCred did not comment on the matter
Responsive Industries could not be reached for its comments immediately
Text messages sent to Ajay Garg, managing director of Equirus Capital, remained unanswered until the publication of this report.
IDFC may
finalise the bids within a week
The buyout will be beneficial for entities without a broking business.
“The company’s strengths are its people and institutional
A bidder starting a fresh broking business may offer a little higher price compared to those that have running broking operations,” said a
senior executive familiar with the matter.
IDFC, the parent entity, had to hive off the securities and mutual fund businesses after IDFC
Bank, its flagship, was proposed to be merged with Capital First, a nonbanking finance company
The merger process would be completed by December-end.
IDFC had acquired the stock broking and investment banking businesses from SSKI,
promoted by Shripal Morakhia, during the last decade.
Mehta is the managing director and chief executive of Axis Capital, but he is bidding
for IDFC Securities in his individual capacity
He is said to have partnered a domestic private equity firm and a Dalal Street veteran in seeking to buy out the business
Mehta joined Axis after the private sector lender had taken over Enam Securities.
Khemani had quit financial services firm Edelweiss a
couple of months ago as the head of investment banking.
Meanwhile, IDFC has been looking to sell its mutual fund and stock broking
businesses as part of its attempts to sell its non-core arms
A couple of large private banks were looking to acquire both units but those talks did not fructify
Earlier this year, the firm was close to selling IDFC Mutual Fund to Avendus Capital, controlled by US buyout giant KKR.
