In a major acquisition deal in the non-banking financial services space, global private investment firm Bain Capital will buy a majority controlling stake in Kerala-based Manappuram Finance Ltd through a combination of preferential allotment of equity and warrants and open offer, a joint statement said.
As part of the transaction, Bain Capital, through its affiliates BC Asia Investments XXV Ltd and BC Asia Investments XIV Ltd, will invest ₹4,385 crore to acquire an 18 per cent stake on a fully diluted basis via preferential allotment of equity and warrants at ₹236 per share, which is at a premium of 30 per cent over the six-month average trading price, according to the terms of the deal.
This transaction will trigger a mandatory open offer for the purchase of an additional 26 per cent stake in the company on an expanded capital basis (excluding warrants). The open offer price has also been fixed at ₹236 per share.
Based on the open offer subscription, Bain Capital’s stake post the investment will vary between 18 per cent to 41.7 per cent on a fully diluted basis (including shares to be issued pursuant to exercise of warrants).
The existing promoter group led by V.P. Nandakumar, Managing Director & CEO, will continue to stay fully invested in India’s second largest gold loan company, which had consolidated assets under management of ₹44,200 crore as at December-end 2024.
“This strategic investment aims to fuel the company’s next phase of growth and drive transformation by enhancing operational excellence, strengthening leadership, and expanding its presence across key segments,” the two companies said.
The existing promoters will hold a 28.9 per cent stake in the company post the investment on a fully diluted basis (including shares to be issued pursuant to exercise of warrants). The transaction is subject to customary closing conditions and regulatory approvals.
Nandakumar said: “As we embark on the next phase of growth, we are delighted to welcome Bain Capital as our new partner. Their leadership team is renowned for its commitment to excellence, and their sharp focus on growth will unlock fresh opportunities for Manappuram Finance. We look forward to a successful partnership that drives innovation and sustained success.”
Pavninder Singh, Partner at Bain Capital, “We are thrilled to partner with Mr. Nandakumar and his team to support Manappuram Finance in its next phase of growth.
“This collaboration leverages our deep expertise and commitment to sustainably expanding India’s financial services sector, while democratising access to financial products that foster entrepreneurship and wealth creation across the country.”
Bain Capital said it has deep experience in investing to support growth and leadership of a diversified set of financial services businesses in India and globally, including Axis Bank, 360One Wealth & Asset Management, L&T Finance Holdings, and Lionbridge Capital, among others.
