CCI Greenlights Warburg Pincus Acquisition of Shriram Housing Finance

The Competition Commission of India (CCI) has given the green light to Warburg Pincus's acquisition of Shriram Housing Finance through its affiliate Mango Crest Investment. The deal, worth Rs 4630 crores, involves equity and convertible instruments of the housing finance company, which is part of the Shriram Group.

The Competition Commission of India (CCI) has approved the acquisition of Shriram Housing Finance Limited (SHFL) by Warburg Pincus through its affiliate Mango Crest Investment. According to a statement released by CCI on Tuesday, Mango Crest Investment Ltd is undertaking investment holding activities in Shriram Housing Finance.

The CCI noted that the principal business activity of the acquirer is investment holding. Mango Crest Investment Ltd is a company incorporated in the Republic of Mauritius.

Shriram Housing Finance Limited (SHFL) is a housing finance company registered with the National Housing Bank. The Non-Banking Financial Company (NBFC) Shriram Finance Limited (SFL) had announced its plans in May this year to sell its housing finance subsidiary arm to private equity firm Warburg Pincus. The transaction amount for the deal was set at Rs 4630 crores for equity and convertible instruments of SHFL. SFL holds a controlling stake in SHFL, while the private equity firm Valiant Partners L.P holds the remaining stake in the housing arm of the company.

SHFL, part of the Shriram Group, has a legacy of nearly five decades and is registered with the National Housing Bank (NHB). The foundation of Shriram Group was laid by industry veterans Ramamurthy Thyagarajan, AVS Raja, and T Jayaraman. Originally starting as a chit fund business, the group expanded into various sectors including Commercial Vehicle Financing, Consumer and Enterprise Finance, Retail Stock Broking, and Distribution of investment and insurance products.

On August 4, 2011, SHFL received its Certificate of Registration from the NHB as required under Section 29A of the National Housing Bank Act, 1987. Separately, the CCI also approved the acquisition of Apollo Healthco by Advent through Rasmeli, a business entity incorporated in Cyprus. Post-acquisition, Rasmeli will make a minority investment in AHL over two tranches, gaining certain rights in AHL.

(With inputs from agencies.)