Hong Kong-based private investment firm Soach Global has picked up a small stake in the National Stock Exchange (NSE) from IFCI Ltd for Rs 59.25 crore ($9 million), as per a company statement.
The deal, which marks another tranche of part-exit for IFCI, has been struck at a marginal premium to the valuation at which the state-controlled firm sold shares in the NSE late last year.
Last September, IFCI sold a 1.5 per cent stake in the NSE for Rs 263.25 crore ($39.7 million then) to an unnamed buyer. It had sold shares at Rs 3,900 each. This valued the NSE, one of the two top national stock bourses in the country, at Rs 17,550 crore ($2.6 billion). In the latest deal, IFCI sold shares at Rs 3,950 each.
In June 2014, IFCI had announced its intention to divest part of its stake in the NSE.
The other major shareholders in the stock exchange include LIC with a 10.51 per cent stake and State Bank of India with a 10.19 per cent stake.
The NSE also has several private investors including PE firms such as General Atlantic, Goldman Sachs, SAIF Partners, Temasek, PremjiInvest, Tiger Global and Norwest Venture Partners.
Soach Global Opportunities Fund, a Mauritius-incorporated investment vehicle of Soach Global, has purchased 1,50,000 shares of the NSE from IFCI. IFCI had last week said it sold as many shares without disclosing the name of the buyer.
Soach Global is led by Anubhav Dayal, who worked with HSBC and Societe Generale before establishing the fund. The firm believes that growth in retail investors’ participation, higher trade volumes and growth in segments like debt and derivatives, which are at a nascent stage, shall soon start reflecting in the NSE’s revenue and profits.
Soach Global Opportunities Fund, which focuses on China and India as target markets, operates as a multi-strategy fund and looks for long-term investment opportunities in different regions and sectors. Soach Capital (Hong Kong) Ltd, a group firm, offers business and management consultancy to large companies and institutions for cross-border business expansion. The company also acts as an arranger of trade finance and other banking facilities.
The fund was advised by IDBI Capital Market Services on the transaction.