US-based prominent equity group Advent is reportedly in talks with Kumar Mangalam Birla to invest in its financial services holding company Aditya Birla Capital Ltd (ABCL). According to the sources, Advent is planning to invest Rs 1,200-1,300 crore in ABCL for a 6-7% stakes.
The company is holding board meeting reportedly on September 5 to consider and approve the fundraising through a qualified institutional placement (QIP) or a preferential allotment. According to the sources, Advent’s proposal might also get approval in the meeting.
Earlier this year, ABCL has received an enabling resolution to raise to Rs 3,500 crore of equity capital. Once the deal is done, Advent will be ABCL’s single largest non-promoter shareholder. The investment to raise fund will be through both – primary and secondary sales of shares.
The family investment arm of Azim Premji, PremjiInvest bought a 2.2% stake in the company for around Rs 700 crore in July 2017. ABCL got listed after Aditya Birla Nuvo merged with Grasim Industries and the financial service were brought under ABCL in September 2017.
On Tuesday, ABCL stocks closed at Rs 87.55 down to 65% since listing for a market value of Rs 19,309 crore. The deal may conclude at a small premium of 3-6% to the current market price with a possibility of a board seat to Advent.
To enhance its tier I capital, Birla is said to have been looking for around seven to nine months and had also approached some of the investors.
ABCL has national footprints with more than 1,300 points of presence, 12,000 employees and 142,000 channel partners or agents.
