ADIA to buy 20% in IIFL Home Finance, largest such investment in the space

Sovereign wealth fund Abu Dhabi Funding Authority (ADIA) will purchase a 20% stake in IIFL House Finance for ₹2,200 crore, valuing the mortgage lender at Rs 11,000 crore. This would be the largest fairness funding in India’s inexpensive housing finance phase by a monetary investor. IIFL House Finance, a completely owned subsidiary of , proposes to make use of the extra capital to proceed its enlargement into new markets to fulfill rising demand for housing loans.

The deal will unlock worth in IIFL Finance, which has a ₹52,000 crore mortgage ebook and market capitalisation of ₹12,500 crore. IIFL House Finance has a mortgage ebook of ₹24,000 crore and market worth of ₹11,000 crore. Shares of IIFL Finance ended flat at ₹329 on Thursday. Whereas confirming the deal, IIFL Group chairman Nirmal Jain mentioned ADIA will convey long-term dedication and wealthy expertise in supporting rising companies. “Given the volatility within the monetary market, the rising rate of interest for residence loans, and tightening of liquidity, the fairness funding is opportune and on the proper time to assist the corporate make the most of probably business consolidation and market development,” he mentioned.

Shareholding Sample

IIFL House Finance has a buyer base of 168,000 with 230 branches. The corporate provides small-ticket mortgages, loans towards property, and building finance. It additionally promotes the development of inexpensive inexperienced buildings in collaboration with housing builders and specialists via its proprietary Kutumb platform to scale back the carbon footprint and ship cost-efficient buildings.

The funding in IIFL Housing goals to help the corporate in its subsequent section of development because it meets demand in India’s massive, under-served and fast-growing, inexpensive housing finance market, mentioned ADIA govt director Hamad Shahwan Aldhaheri.

Nirmal Jain and his household have a 25% stake in IIFL Finance. Canadian investor Prem Watsa’s Fairfax Group and the UK’s CDC Group plc personal 22.3% and seven.7%, respectively, of IIFL Finance. Basic Atlantic, Bain Capital, and The Capital are among the different buyers in IIFL Finance.

Earlier this 12 months,

Capital raised $1.8 billion from a consortium of buyers led by ADIA for its third low-cost housing fund.

ADIA, with property below administration price $800 billion, has huge publicity in India. Its important investments embody Flipkart,

Retail, Mindspace REIT, HDFC Capital, , , , and Mobikwik. Since 2018, ADIA has invested greater than $3 billion in India. In December, ADIA purchased about 5.8 million shares of Housing, representing a 1.26% stake. ADIA bought a 1.2% stake in Reliance Retail for ₹5,513 crore in 2020.

ADIA owns a stake in almost 25 listed corporations similar to

, Bharat Dynamics, , Mind Design, , , and , amongst others.