Fairfax India announces ₹2,000 crore infusion into IIFL Capital Services

Fairfax India will infuse ₹2,000 crore into IIFL Capital Services through a mix of transactions, increasing its stake in the company to at least 51 per cent

Canada-based Fairfax India Holdings Corporation (Fairfax India) will invest primary capital worth Rs 2,000 crore in IIFL Capital through its wholly owned subsidiary FIH Mauritius Investments. It will invest funds through a combination of transactions, including the preferential allotment of equity shares and an open offer. This would take Fairfax's stake in the company to a minimum of 51 per cent.

 

Fairfax India, through FIH Mauritius and its affiliate, currently holds about 30.5 per cent in IIFL Capital. FIH Mauritius will have the right to nominate two directors on the board of the company, subject to shareholder and regulatory approvals.

 

 

Upon completion of the transaction, Fairfax India and its affiliate, HWIC Asia Fund Class A, will join the existing promoter group alongside Nirmal Jain and R Venkataraman.

 

The proposed transaction remains subject to customary regulatory and shareholder approvals, including applicable open offer requirements under Securities and Exchange Board of India (Sebi) regulations.

 

“The proposed capital infusion of Rs 2,000 crore at Rs 350 per share will significantly strengthen the company’s balance sheet and support the next phase of growth across its capital markets, wealth management, asset management, institutional equities, investment banking, and related financial services businesses,” the company said.

 

Commenting on the investment, Prem Watsa, founder of Fairfax India, said, “Fairfax has enjoyed a long-standing and successful partnership with IIFL Capital and its founders, Nirmal Jain and R Venkataraman, who have done an outstanding job growing IIFL Capital’s business. IIFL Capital is now one of India’s leading financial services companies, and with this new capital infusion we believe the company is well positioned for the future as it expands its wealth and asset management services offerings, while maintaining its leading position in retail broking and financial services.”

 

According to IIFL Capital, the induction of Fairfax representatives onto the board is also expected to further strengthen governance standards, oversight, risk management frameworks, and institutional processes, while preserving the entrepreneurial and execution-focused culture of the company.

 

Nirmal Jain, promoter, IIFL Capital, said, “Fairfax India and its affiliate have been a trusted long-term partner of the IIFL Group for over 15 years, and together we have created significant value for all stakeholders. Over the years, this relationship has been built on deep mutual trust, shared values, and a long-term commitment to institution building”.

 

“At a time when the Indian economy and financial markets are at a major inflection point, we believe this is the right moment for IIFL Capital to benefit from strong parentage and position itself for the next phase of growth. This transaction reflects Fairfax’s continued confidence in IIFL Capital’s leadership team and its robust business model,” R Venkataraman, co-promoter and managing director, IIFL Capital, said.

 

The shares of IIFL Capital Services were up 4.40 per cent at Rs 346.05 on Thursday on the BSE.