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IDFC Plans Holding Co; To Raise Upto $750M; Increase ESOPS

16 August, 2008

Infrastructure Development Finance Company (IDFC) is planning to set up an intermediate holding company for of its four subsidiaries – IDFC-SSKI Securities, IDFC Private Equity, IDFC Project Equity and IDFC Capital Singapore, Business Standrad has . The company will seek shareholder approval for this in its annual general meeting (AGM) to be held on July 18. The step is being taken for easier management of the company as all the non-balance sheet business will be grouped into a single entity.

IDFC has also informed the shareholders about its intention to raise upto $750 million (Rs 3,150 crore) by way of issue of securities to entities such as foreign investors/institutions, corporate bodies, mutual funds, banks and insurance companies.This proposal is expected to be approved in the forthcoming AGM. Besides, the company also plans to increase its employee stock options limit from 2 per cent to 5 per cent of the company’s equity.

The company is not planning to list these entities in the near future. IDFC-SSKI offers services such as institutional equities and investment banking services. IDFC holds 80 per cent stake in IDFC-SSKI while the rest 20 per cent is held b1y the employees trust. This trust will receive shares in the holding company as per value determined by independent valuers and approval of board of IDFC and IDFC-SSKI.

IDFC holds 100 per cent in other subsidiaries, including IDFC Private Equity. Emplooyees of IDFC will also be given stock option in the holding company up to 5 per cent of the share capital.

IDFC Infrastructure Fund recently received $100 million investment from UK government-backed private equity firm CDC. It was also reported that IDFC is planning to list its $1.25 billion infrastructure fund. IDFC posted net profits of Rs 742 crore for the year ended March 31, 2008 as compared to Rs 503 crore for the year ended March 31, 2007.

 


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IDFC Plans Holding Co; To Raise Upto $750M; Increase ESOPS

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