Millennium India Acquisition Co-backed SMC Group has completed the first phase of its joint venture transaction with South Africa’s Sanlam Group. Sanlam has invested Rs 36 crore (~ $7.4 million), to pick 1% stake in SMC Global Securities, the flagship of the SMC Group, along with warrants to increase its equity stake to 5%, at the same enterprise valuation.
This deal values SMC Global Sec at Rs 3,600 crore ($740 million). Sanlam, which has global assets under management and administration of ~$50.7 billion, has also invested Rs 30 crore (~$6.1 million), picking up a 50% stake in SMC Wealth Management and has committed to invest Rs 30 crore (~$6.1 million) to pick 50% stake in SMC Asset Management.
These transactions are part of the agreements announced in September 2008. The partners had last year entered into joint venture agreementsto set up two new businesses in India -- a wealth management company and an asset management company to tap onto growth opportunities in India.
SMC Wealth Management has already garnered assets of over Rs 80 crore (~ $16.4 million) over the last few months and the partners are hoping to get approvals to launch the asset management venture within the next 6-9 months.
Privately held SMC Group is into financial services busisess offering brokerage, research, equity, commodity and derivative trading, besides other related activities. Nasdaq-listed investment fund Millenium India owns 15.3% stake in SMC Group.