HDFC trims stake sale in CAMS to Warburg Pincus

Housing Development Finance Corporation Ltd will sell a smaller stake than agreed earlier in Computer Age Management Services Pvt. Ltd (CAMS) to private equity firm Warburg Pincus.

India’s biggest mortgage lender said in a stock-exchange filing it will now sell a 5.1% stake in CAMS to Warburg affiliate Great Terrain Investment Ltd for Rs 169.52 crore ($26 million). It had, in December, agreed to sell a 6.3% stake for Rs 209.50 crore.

It did not specify any reason for revising the stake sale pact.

The sale is likely to be completed by 30 April 2018, HDFC said.

HDFC will retain a 5.99% stake in CAMS, a mutual fund registrar and transfer agent, after the deal is concluded, the lender said. This is up from the 4.8% agreed before.

HDFC’s associate HDFC Bank is also selling a part of its stake in CAMS to the PE firm at the same price. It didn’t disclose the stake the private-sector bank is selling.

The deal values CAMS at Rs 3,325 crore ($510 million).

According to VCCEdge, the data research platform of News Corp VCCircle, HDFC Group owned a 23.17% stake in CAMS as of March 2017. Promoter group Acsys Investment Pvt. Ltd held a 31.83% stake while NSE Strategic Investment Corporation Ltd had 45%.

The company’s total income was Rs 502.6 crore and profit after tax stood at Rs 127.1 crore in the year through 31 March 2017.

It caters to the asset management industry and has partnered with insurance companies, private equity funds and financial services firms to offer them technology enabled services.

Warburg Pincus, which invests in India outs of its global funds, has poured money into several companies in the country over the past couple of years.

In the financial services sector, it has invested in AU Small Finance Bank, Capital First, HDFC and Kotak Mahindra Bank, among others. In July last year, it picked up a 9% stake in ICICI Lombard General Insurance for $282.71 million.

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