Swiss impact investor BlueOrchard-backed Satya MicroCapital Ltd, focused on self-employed rural women, said it has completed a strategic investment to pick up 24% stake in Baid Housing Finance.
Satya MicroCapital is in the process of completing the acquisition of Baid Housing Finance and the current acquisition is done for 24% stake whereas the application for the remaining 76% acquisition has already been submitted to RBI/NHB and is subjected to receiving formal regulatory approval, the company said in a statement.
Financial terms of the transaction remained undisclosed.
As part of the alliance, Satya MicroCapital and Baid Housing Finance will continue to oversee their day-to-day financing operations to help each other fuel growth and profitability.
With this acquisition, Satya plans to serve the need for affordable housing for its current customer base and to cater to the untapped affordable housing market across the country, the statement added.
Resurgent India served as the official advisor to the transaction.
“This step towards affordable housing finance is Satya’s natural extension towards financial inclusion. We are looking forward to building this business which will induce a positive social impact on the customer segment. Our foremost inclination will be towards financially backing the first-time homeowners to build their dream home,” said Vivek Tiwari, MD, CEO & CIO of Satya MicroCapital Ltd.
Baid Housing Finance Pvt. Ltd was founded in 2008 also has a focus on under-served and low-income customers.
“With the leadership of Mr. Vivek Tiwari and Satya MicroCapital’s well established branch network in 21 states specially in the rural areas huge number of unserved families will be able to improve their living conditions by owning a home or renovating and repairing their existing homes," said Mahendra Kumar Baid and Aditya Baid, both Directors at Baid Housing Finance.
Satya MicroCapital, backed by Japanese investor Gojo & Company Inc and Swiss impact investor BlueOrchard Finance, was floated by Vivek Tiwari, who is the firm’s managing director. He bought TFC Finvest Ltd, a New Delhi-based NBFC, and rebranded it as Satya MicroCapital. It started the microfinance operations in October 2016.
Satya MicroCapital has disbursed a total of more than 6.15 lakh loans worth over Rs 3,709 crore with assets under management of Rs 1,700 crore.
The non-banking financial company (NBFC) is mainly focused on the underbanked and under-served borrowers, especially women, with their husbands acting as co-borrowers; through an affordable credit product that allows them to start a new business or build their existing business.
In August this year, Satya MicroCapital had raised Rs 135 crore through non-convertible debentures (NCDs) from impact investment fund manager responsAbility Investments and Swiss impact investor BlueOrchard Finance. Earlier this year, raised fresh equity of Rs 153 crore ($21 million) from Japan-based Gojo & Company Inc. The Japanese firm, which holds stakes in several microlenders, had led a Rs 43 crore equity funding round in Satya MicroCapital in August 2018.
Previously, the lender raised Rs 16 crore from Dia Vikas Capital in October 2017 and Rs 11.5 from existing investors through a rights issue in June 2018.