IIFL Special Opportunities Fund has bought a 2.59% stake in Reliance Nippon Life Asset Management Ltd (RNAM) for $60 million (about Rs 390 crore) through a secondary market purchase, said a press statement.
The deal values Reliance Nippon Life at around Rs 15,000 crore.
IIFL Special Opportunities Fund acquired the stake from US-based hedge fund Eton Park Capital Management. As of March 2016, Eton Park held 4.43% in the company.
“We have garnered a commitment of around Rs 4,300 crore from our funds and could be well on our way to be a billion-dollar domestic fund, making it one of the biggest AIFs in India so far,” said Amit Shah, chief executive officer of IIFL Asset Management.
RNAM, jointly owned by Japan's Nippon Life and Anil Ambani-led Reliance Capital, plans to float an initial public offering (IPO) in October. IIFL Special Opportunities Fund mainly invests in companies before or during their IPOs.
IIFL Asset Management has achieved the final close for both of its Special Opportunities Funds. The first fund had raised $250 million and announced closure in May while the second fund marked its closure in July at $216 million.
IIFL Special Opportunities Fund is a closed-ended scheme under Category II, which includes alternative investment funds like private equity and debt funds.
In May, it picked up 1.59% stake in ICICI Lombard General Insurance Company Ltd for $49.94 million.
RNAM’s assets under management (AUM) grew 25% year on year to Rs 3,58,059 crore ($55.1 billion) as on 31 March 2017. This includes mutual fund AUM of Rs 210,891 crore. Total income rose 9% to Rs 1,436 crore and profit before tax increased 16% to Rs 581 crore in 2016-17.
RNAM acts as adviser to India-focused equity funds and fixed-income funds in Japan and South Korea. It also manages offshore funds through its subsidiaries in Singapore and Mauritius, catering to investors across Asia, the US and Europe.
Reliance Capital’s other businesses include life and general insurance, stock broking, wealth management, home finance, and asset reconstruction. In May, it received approval from stock exchanges to spin off and separately list its home finance unit.