Fairfax India makes open offer to raise stake to 26% in IIFL

Canadian investor Prem Watsa's Fairfax India Holdings today made an open offer to raise its stake to 26 per cent in financial firm IIFL Holdings for a total consideration of Rs 1,621 crore, valuing the company at around Rs 6,400 crore.
It proposes to acquire 8.3 crore equity shares at a price of Rs 195 each other than those shares already owned by it and its affiliates according to regulations of the SEBI for substantial acquisitions of shares and takeovers, Fairfax India Holdings Corporation said in a statement.
The open offer is expected to close later this year subject to receipt of regulatory approvals in India, it added.

"Fairfax, India's parent, currently owns approximately 8.97 per cent of IIFL and has an economic interest in another approximately 5.24 per cent of IIFL through derivative instruments (all acquired prior to the establishment of Fairfax India)," it said.
Fairfax India was established by Fairfax to invest in businesses in India with a view of long-term capital appreciation, it said.
It is familiar with IIFL through Fairfax's long-standing prior ownership interest in the financial firm and is executing on its strategy by making this offer.

IIFL operates businesses in non-banking finance, housing finance, wealth management, retail broking, institutional equities, investment banking and insurance distribution.

The diversified financial services holding company generated approximately Rs 2,220 crore in revenue and Rs 480 crore in earnings for the fiscal ended March 31, 2015.
"IIFL, under the independent leadership of its executive chairman, Nirmal Jain, has an impressive management team with a strong, long-term history of profitable growth, which fits within our strategy for investing in well-managed companies with high integrity and long-term track records in India," said Prem Watsa, Fairfax India's Chairman.
Watsa headed Fairfax had made an unsuccessful bid to acquire smartphone maker BlackBerry in 2013.