Global investor Canadian Pension Plan Investment Board (CPPIB) has proposed to join Bain Private Equity and Bain Credit in acquiring minority stake in IIFL Wealth Management Ltd, according to a disclosure.
Recently, VCCircle reported CPPIB’s plans to grow its India credit business through its 'sponsor finance' portfolio, by extending credit to private equity fund managers for their deals.
Last month, Bain Capital agreed to acquire 24.98% stake in IIFL Wealth Management Limited for Rs 3,680 crore ($485.6 million).
The acquisition will be made through BC Asia Investments X Ltd, the investment vehicle which will be controlled by Bain Private Equity, Bain Capital Credit Member LLC and Bain Capital Member II (together Bain Credit) and CPPIB, which invests funds transferred to it by the Canada Pension Plan Fund, according to a disclosure by the monopoly watchdog Competition Commission of India (CCI).
Existing investors General Atlantic and Fairfax India Holdings Corporation will make partial exits from IIFL Wealth, part of the homegrown financial services firm IIFL Group.
As of March end 2022, General Atlantic owned 20.99% in IIFL Wealth while another 13.63% was held by FIH Mauritius Investments Ltd, a wholly owned subsidiary of Fairfax India Holdings Corporation, owned by Indian-born Canandian billionaire Prem Watsa.
US-based investment firm, Capital Group’s SmallCap World Fund Inc owned 4.94% stake while WF Asian Reconnaissance Fund, a Hong Kong-based hedge fund operated by Ward Ferry Management held 4.51% stake in IIFL Wealth Management.
CPPIB, which also acts as a limited partner (LP) globally, has financed some of its portfolio fund managers in making acquisitions including in India.
Mumbai-based IIFL Wealth Management is among the leading wealth and alternative asset managers in India with over $44 billion (around Rs 3.3 trillion) in assets (as of 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 networth and ultra-high networth individuals, family offices and institutions.
The company has approximately 900 employees and a presence in 4 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 in IIFL Finance.
