Manappuram Finance Ltd, the Kerala-based NBFC, is planning to acquire Hyderabad-based NBFC, Indian School Finance Company Pvt Ltd (ISFC). The deal is valued at Rs 2.48 billion.
Manappuram has agreed to enter into binding agreements with ISFC and its shareholders, for acquiring 85.39 per cent stake by way of secondary purchase from the existing financial investors, an impact investors Gray Matters Capital and Caspian, which will exit from the company by selling is 3.48 per cent.
ISFC focuses on lending to the education segment with loans to affordable private schools, vocational colleges, coaching centres etc. ISFC has assets under management (AUM) of Rs 5.22 billion and shareholders’ funds of Rs 900 million (including compulsorily convertible instruments) as of March 31, 2018. ISFC has served over 2.6 million students through approximately 4500+ institutions since its inception.
The Company has a country-wide footprint spanning 116 locations across 15 states in India through a hub & spoke model, with an employee base of over 300.
V P Nandakumar, MD & CEO of Manappuram Finance Ltd, who did not respond to queries, in a statement said, “as a niche player, we expect ISFC’s business to be both scalable and profitable. We believe this acquisition will enable Manappuram Finance to grow faster and thereby help us achieve greater diversification.”
“With ISFC, Gray Matters Capital pioneered the private school ﬁnance sector in India. With our investment in ISFC, we enabled a dynamic ecosystem of borrowers and lenders in the private school sector with its focus on quality and access, underscoring our credence of being ecosystem investors”, said Ragini Bajaj Chaudhary, India CEO, Gray Matters Capital.