IDFC has acquired the remaining 20% stake in IDFC-SSKI Securities from senior executives of SSKI making it a wholly owned subsidiary. As per a disclosure to the stock market, IDFC said, it hiked its holding in the institutional equities and I-banking services firm from 80% to 100% during the nine-month ended December’09.
As per back of the envelope calculations by VCCircle, IDFC spent Rs 450 crore (~$97 million at current exchange rates) to get full ownership of IDFC-SSKI Securities.
IDFC had initially bought 33.3% stake in SSKI in 2006 for Rs 100 crore and thereafter increased the equity interest to 66.7% in 2007 by buying shares from founder Shripal Morakhia. The Morakhias had also exited their retail equity business by selling Sharekhan to Citigroup Venture Capital.
IDFC PE has assets under management of Rs 5,992 crore (~$1.3 billion) through three funds, namely Fund I – Rs 844 crore, Fund II – Rs 1,988 crore and Fund III – Rs 3,160 crore.
The financial services giant has also disclosed that it has recently incorporated three wholly owned entities: IDFC Pension Fund Management Company Limited, IDFC Funds of Funds Limited and IDFC General Partners Limited.
Meanwhile the asset management and I-banking business is growing much faster than its core infrastructure lending business. For the nine months ended December’09, the asset management and I-banking arms grew 58% in revenues to Rs 347.84 crore while infrastructure lending business grew 8.5% to Rs 2,668 crore.
The picture is starker when it comes to profitability. As against 24% increase in segment profit from lending business, the asset management and I-banking units saw 84% jump in profits.
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