French banking group BNP Paribas SA today said it will acquire 49.9 per cent stake in Sundaram Home Finance (SHFL) for Rs 196.98 crore, a move which will give the foreign firm an increasing presence in the booming housing loans market of India. | |
| Sundaram Finance and Union de Credit pour le. Batiment SA (UCB), a wholly owned subsidiary of BNP Paribas SA, today reached an agreement to this effect, which is subject to approval from the shareholders. |
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| The French firm would pay around Rs 146.98 crore to SHFL, while Rs 50 crore would be invested directly in the company, resulting in a 49.90 per cent stake for UCB in the enhanced paid-up equity capital of SHFL, Sundaram Finance said in a communique to the Bombay Stock Exchange. |
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| On completion of the transactions, Sundaram Finance would own the remaining 50.10 per cent of the enhanced paid-up equity capital. |
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| Home loans rose around 30 per cent in the nine months ended December 31 and market analyst are targeting a growth of 25 per cent this fiscal. |
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| BNP Paribas already owns 49.9 per cent stake in Sundaram Finance's asset management company. |
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| The French banking major became the largest shareholder of south-based Geojit Financial Services in March as the latter issued 5.68 crore shares and 2.28 crore warrants to BNP Paribas. |
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| BNP Paribas also has a stake in SBI Life, which is being jointly promoted by State Bank of India and Cardiff SA, the insurance arm of BNP Paribas. |
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| Bloomberg adds: BNP Paribas SA, France's largest bank by market value, reported a 25 per cent increase in first-quarter profit on higher corporate and investment bank earnings and gains from asset sales. The shares rose to a record. |
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| Net income climbed to ¤2.51 billion ($3.4 billion), or ¤2.73 a share, from ¤2.01 billion, or ¤2.38, a year earlier, Paris-based BNP said today. Profit beat the ¤2.06 billion median estimate of 13 analysts surveyed by Bloomberg News. Revenue rose 21 per cent to ¤8.21 billion. |
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| "It's another good set of results,'' said Jerome Forneris, who helps manage $8.1 billion at Banque Martin Maurel in Marseilles and owns shares in BNP Paribas. |
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| "Corporate and investment bank earnings are good and asset management also performed well in the quarter. Retail bank numbers are looking weaker but this is no surprise.'' |
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