Financial services conglomerate Religare Enterprises has emerged as frontrunner to acquire American International Group’s (AIG) investment unit. Earlier reports indicated that Religare will partner will Australian banking giant Macquarie to buyout AIG Investments.
The latest report suggests that the Delhi-based firm may buy the asset management firm independently according to Financial News. Religare is being advised by Jefferies on the bid.
A spokesperson from Religare declined to comment on this development when contacted by VCCircle.
Franklin Templeton Investments, one of the largest asset managers in the world, was also in the race but pulled out last month. Singapore state investor Temasek Holdings Pte Ltd, Hong Kong tycoon Richard Li's Pacific Century Group, and New York-based private equity firm Crestview Partners LP, were also part of the Franklin consortium.
While Temasek and Pacific Century pulled out with Franklin, Crestview is still reported to be in the race. Last week the PE firm was reported to be close to the deal at a price of $300-400 million.
AIG Investments, which manages funds in excess of $85 billion, is expecting a valuation of $500 million. The latest report says that Religare is willing to spend $500 million to build an international
asset management business. AIG is selling its assets in order to repay the $182.5 billion bailout by the US government.
Last year, Religare acquired London-based broker Hichens Harrison & Co Plc for £56 million. The firm appointed Matthew H Mongia as a Director, Global Asset Management, of Religare Hichens Harrison earlier this year to develop its asset management vertical via new
product launches and strategic acquisitions globally. Mongia has worked with Monsoon Capital and Fidelity Investments.
Religare Enterprises Ltd is the financial services company owned by Malvinder and Shivinder Singh, the promoters of Ranbaxy Pharmaceuticals. The Singhs signed a deal with Japanese pharma company Daiichi Sankyo in June 2008 to sell their 34.8% stake in the company
for Rs 9,576 crore.
Since then, the Singhs have been expanding their financial services and healthcare business.