Private equity firm General Atlantic has agreed to acquire a 21.61% interest in IIFL Wealth Management, the wealth management subsidiary of IIFL Holdings (formerly India Infoline) for INR11.2bn ($172.4m).
Through this strategic investment, General Atlantic will become a minority shareholder in wealth subsidiary IIFL Wealth Management.
IIFL said that General Atlantic’s investment will support the company’s continued growth and platform expansion as the premier wealth management company in India.
Under the terms of the transaction, IIFL Holdings will allot General Atlantic 1.7 million equity shares of IIFL Wealth at a price of INR586.7 each for INR1bn as well as allot 13.6m warrants of IIFL Wealth for INR8.6bn to General Atlantic.
The transaction will result in aggregate investment by General Atlantic of up to INR9.6bn into IIFL Wealth Management.
Additionally, General Atlantic Singapore will acquire 2.7m shares worth INR1.6bn from employees of IIFL Wealth Management.
IIFL Wealth Management founder and CEO Karan Bhagat said: "We founded IIFL Wealth with a customer-first and product-centric focus to meet and exceed the unique needs of Indian families looking to manage and grow their wealth. General Atlantic’s investment is testimony to the quality of the team that we have built."
IIFL Holdings founder and chairman Nirmal Jain said: "It is with this continued commitment to our customers that we welcome General Atlantic as a strategic partner for our next phase of growth.
"As a leading investor with deep expertise in financial services and wealth management, General Atlantic is well-aligned with our mission and will help to take IIFL Wealth to the next level through expanded products and services."
"Upon the co summation of the transaction, the company will own 53.86 per cent of IIFLW on a fully diluted basis that is assuming full conversion of warrants over the next 18 months and maximum possible dilution due to vesting of all outstanding stock options over the next four years," IIFL said in the BSE filing.
Founded in 2008, IIFL Wealth provides investment products and services customised for HNW Indian families. The company advises, distributes and manages $12bn of assets for over 8,600 clients through its 150 plus relationship managers.