IFC to invest $75 mn in Clearwater India Ltd

WB's arm will also invest Rs 60 cr in Aditya Birla's MyUniverse

The International Finance Corporation (IFC) plans to invest Rs 450 crore (around $75 mn) in Clearwater India Ltd (CIL). The portfolio company held by funds managed by Clearwater Capital Partners (Clearwater). Clearwater is an Asia-dedicated credit and special situations investment firm.

CIL, an NBFC registered with the RBI, was set up in 2005 as an onshore primary lending platform.

The investment will be in the form of a senior debt investment by subscribing to non-convertible debentures (NCDs) to be issued by the company.

IFC's investment would generate a demonstration impact with local banks for them to offer debt financing to local stressed /distressed asset investors. "Presently, there is practically no bank financing to support investors in the market," said IFC in a release. IFC's participation in this project will promote and expand private sector stressed/distressed asset investment in India.

Clearwater was founded in 2001 by Robert Petty, Managing Partner and Co-Founder, and Amit Gupta, Partner and Co-Founder. CIL’s investments are primarily focused in Chennai, Mumbai, National Capital Region (NCR), Bangalore and Pune.

IFC’s proposed investment in CIL will provide capital support at a time when there is limited bank financing available to support companies through stressful and distress situations, and lay the foundation for effective asset investment and a credit solution culture.

Meanwhile the IFC also plans to invest around Rs 60 crore in MyUniverse, part of the Aditya Birla Group. The proposed investment would be used for the personal financial services company to bring out new product platforms in mobile and to create awareness.

MyUniverse is the personal financial services brand of Aditya Birla Customer Service Pvt Ltd (ABCSPL), which is a subsidiary of Aditya Birla Financial Services Pvt Ltd. (ABFPL) which in turn is a subsidiary of Aditya Birla Nuvo Limited (ABNL), a listed entity of the Aditya Birla Group. MyUniverse is a personal finance portal where individuals need to link their salary, investments and other financial account with the portal for effective finance management.

The World Bank's investment arm's investment will be through equity upto Rs 60 crore (around $10 million) in ABCSPL. The investment will be used for accelerating the building of product platform, especially mobile, strengthening technology platform, building category and brand awareness, and scaling customers onto the platform, according to IFC's disclosure.

"IFC's investment in this business and its strict adherence to high corporate governance standards will enhance trust of the platform. This will help drive adoption of this platform in an accelerated manner. In this case, a long-term partnership with the IFC will benefit the sponsor in implementing their long term strategy for growing this business," said IFC.

IFC's partnership with MyUniverse can help it connect with 65 South Asian financial markets clients and the 800 global level clients. These connections will help MyUniverse increase its depth in providing access to a myriad of financial services products and eventually expand the platform across South Asia, subject to the requisite approvals.