TVS Capital leads $94M deal to buy FTIL’s 25.64% stake in Indian Energy Exchange

Blackstone-backed Financial Technologies (India) Ltd (FTIL) has entered into a share purchase agreement to exit Indian Energy Exchange (IEX) by selling its entire stake holding to a clutch of investors led by private equity firm TVS Capital for an aggregate consideration of Rs 576.84 crore ($94 million), as per a stock market disclosure.

The deal values IEX at Rs 2,250 crore ($366 million).

FTIL has signed the agreement with TVS Shriram Growth Fund 1, S Gopalkrishnan, Lakshmi Narayanan, Rajeev Gupta, Dalmia Cement Bharat Power Ventures Ltd, Kiran Vyapar Ltd, TVS Capital Funds Ltd and Agri Power and Engineering Solutions Pvt Ltd for sale of 25.64 per cent equity stake in IEX, the disclosure showed.

The transaction is, however, subject to fulfilment of certain conditions precedents including buyouts of the application software and other technology for its own use only by IEX and regulatory approvals, if any. As per the agreement, the transaction is expected to close within 30 days, unless extended by all the parties.

IEX offers an online electricity trading platform for trading, clearing and settlement operations. As per its site, over 800 private generators and more than 2,800 open access consumers are leveraging the exchange platform to manage their power portfolios.

It also counts several other private equity and venture capital investors including Multiples PE, Bessemer Venture Partners and Lightspeed Venture Partners.

Earlier in March, FTIL sold off some stake in lEX to Golden Oak (Mauritius) Limited, following which FTIL's shareholding in power exchange came down to 25.64 per cent.

Although this couldn’t be verified independently, Golden Oak is believed to be part of Ambit Mauritius Investment Managers.

This transaction was to comply with Central Electricity Regulatory Commission (CERC) regulations to bring down the company’s stake in lEX to 25 per cent as previously announced. As per FTIL annual report, this was to be met by January 20, 2014. As of March 31, 2013, FTIL held 33.5 per cent stake in IEX.

(Edited by Joby Puthuparampil Johnson)

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