IL&FS buys Saffron Asset Advisors

IL&FS Investment Managers (IIML), the private equity (PE) arm of IL&FS group, today said it would acquire Saffron Asset Advisors (SAAPL), a Mumbai-based real estate fund manager.

After the acquisition, IIML would become the largest Indian PE player, with assets under management (AUM) of $3.2 billion. It did not disclose the deal amount.

IIML will merge Mauritius-based Saffron Capital Securities, the parent company of SAAPL, and Saffron Capital Advisors (SCAL) with its Mauritius-based entity, IL&FS Investment Advisors LLC (IIAL).

As a result, IIML, through its subsidiary IIAL, would become advisor to two Saffron-managed, India-focused realty funds, including NYSE Euronext-listed Yatra Capital, the company said in a statement today.

After the acquisition, IIML’s AUM would go up by $400 million to $3.2 billion, it said. The employees of Saffron are most likely to be retained, it is learnt.

“We want to manage funds which are on the listed platform. Now, we can raise more funds, expand the business and increase the profitability,” said Shahzaad Dalal, vice-chairman of IIML.

IIML was planning to launch a $300-million offshore fund and a $350-million generic PE fund, Dalal told Business Standard.

“I think smaller funds are finding it difficult to sustain in the current competitive environment. It is beginning of the consolidation among the property funds,” said Ambar Maheshwari, director, investments, DTZ, an international property consultant.