Gold loan firm Manappuram Finance Ltd is acquiring controlling equity stake in Asirvad Microfinance Private Limited (AMPL), which provides micro loans, housing and festival loans to poor women, for an undisclosed amount, as per a stock market disclosure.
The gold loan firm has signed a non-binding term sheet with Asirvad Microfinance to acquire majority equity shareholding through a combination of secondary purchase of equity shares from certain existing shareholders and primary investment by way of subscription to equity shares in AMPL, it said.
The firm did not disclose the name of the sellers. An existing financial investor in AMPL is Lok Capital. It is not clear if it has part or fully exited in the transaction. We are contacting the firm for more clarity on this and will update the story as we hear from the management.
Chennai-based Asirvad Microfinance is promoted by S V Raja Vaidyanathan. Founded in 2007, the company is present in the states of Tamil Nadu, Kerala, Odisha and Gujarat.
Last month, Manappuram Finance had announced that it is looking for diversification of its business into microfinance and financing of commercial vehicles.
In March this year, Manappuram Finance agreed to acquire Milestone Home Finance Company Pvt Ltd (Milestone) from Jaypee Hotels Ltd for an undisclosed amount, as part of its plans to diversify its business by commencing housing finance activities.
Founded in 1990, the company is engaged in providing gold loans, insurance services, foreign exchange, business loans, vehicle loans and gold coins. It is based in Thrissur, Kerala with an office in Mumbai.
(Edited by Joby Puthuparampil Johnson)