PAG, a leading investment firm, has acquired 61.5% stake in Edelweiss Wealth Management for ₹2,366 crore, the fund house stated in a regulatory filing on Tuesday. “PAG has made an investment of Rs2,366 crore in EWM, including primary and secondary investment. In addition, PAG is also acquiring the entire ownership of the prior investors in EWM, Kora Management (Kora) and Sanaka Capital (Sanaka), taking its stake to 61.5%,” the statement said. PAG is a leading private equity investor in Asia’s fast-growing economies.
This infusion will further strengthen the equity base and provide growth capital, it said, adding, “PAG and Edelweiss will work together towards demerger and the eventual listing of the business, paving way for unlocking value.”
“This partnership will result in unlocking longterm value for shareholders and accelerating business growth,” it further mentioned.
Commenting on the investment, Rashesh Shah, chairman and chief executive officer, said, “Our focus will continue to be on enhancing the value of the franchise while simultaneously exploring avenues to unlock this value for the shareholders.”
Nikhil Srivastava, partner and managing director, Head of India Private Equity, PAG said, “We look forward to leveraging PAG’s global experience to drive innovation and transformation to further strengthen EWM’s market position and create long-term value for all stakeholders.”
With a growth trajectory of 12.5% per year, the wealth management indutry is expected to reach ₹540 lakh crore in the next five years, the company said. The fund house had reported revenues of ₹800 crore and profit after tax of ₹180 crore for the nine-month period ended 31 December, 2020.
“The focus will be on strengthening the leadership position in businesses like Alternatives Asset Management and Asset Reconstruction while further enhancing the retail expansion through Housing Credit, SME Credit, Life & General Insurance and Mutual Funds,” Nitin Jain, managing director & chief executive officer, Edelweiss Wealth Management mentioned.