Blackstone to buy about 16% of IIFL Finance for $535 million
BX•Blackstone will buy about 16% of IIFL Finance for 50 billion rupees, or about $535 million, as part of a 64.14 billion rupee capital raise. The investment is expected to lift IIFL Finance’s capital adequacy ratio to about 30% from 17%.
1. Blackstone investment
Blackstone will invest 50 billion rupees in IIFL Finance through compulsorily convertible preference shares. The investment is part of a 64.14 billion rupee capital raise that also includes 12.64 billion rupees from existing shareholders Nirmal Jain and R. Venkataraman, and 1.5 billion rupees from Anchorage Capital.
2. Capital and lending
IIFL Finance said the investment will raise its capital adequacy ratio to about 30% from 17%. The additional capital will support growth in secured lending, particularly gold finance, and could help improve credit ratings and lower borrowing costs over time. The lender had consolidated assets under management of 1.24 trillion rupees at September-end, while gross non-performing assets were 1.5% of total loans.
