Global private investment firm KKR on Tuesday announced acquisition of a majority stake in Indian financial services firm Avendus Capital for an undisclosed amount.
Sources in the know pegged KKR’s investment at $100-110 million through a combination of new shares and purchase from existing investors — Eastgate Capital and Americorp Ventures. KKR’s investment is routed through its Asian Fund II.
The acquisition will help KKR foray into the credit solutions business and to grow its wealth and alternative asset management solutions offerings to its customers. KKR India has a non-banking financial company (NBFC) and a real estate NBFC through which it offers structured loans.
Sanjay Nayar, member – KKR and CEO – KKR India, said the acquisition will help meet the demand of rising entrepreneurship in India by offering diverse alternative investment products and wealth advisory services.
“Avendus is a world-class firm built and run by three visionary founders which delivers solutions to meet this demand by offering diverse alternative investment products and wealth advisory services. The Avendus team continues to build on this banking franchise by seeking opportunities to elevate the company to the next level. KKR’s investment will aid this effort by accelerating the build-out of the company’s highly sought-after investment banking platform,” Nayar said in a press release.
According to reports, KKR has purchased 60% stake in Avendus and its ownership will increase to 70% after the said acquisition that is awaiting regulatory clearance. Avendus’ existing management team, led by co-founders Ranu Vohra, Gaurav Deepak and Kaushal Aggarwal, will continue to manage day-to-day operations and its growth into the new businesses. KKR will have a nominee on the board of directors of Avendus.
Ranu Vohra, MD and CEO of Avendus, said the company’s new motto is to ‘scale up’ its businesses. “We have excellent potential to expand our businesses…KKR’s capital commitment and support will enable us to provide a broader set of synergistic services and products to these clients, which can catalyze their growth,” Vohra said.
Eastgate Capital had invested R100 crore in Avendus in 2008 for a 26% stake. It’s the PE unit of NCB Capital, investment banking arm of National Commercial Bank of Saudi Arabia. Americorp Ventures is an angel investor associated with Avendus since inception with 13% ownership.
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