Bain Capital to acquire 18% stake in Manappuram Finance for ₹4,385 crore

Bain Capital acquires joint control in Manappuram Finance, India's 2nd largest gold loan financier, for growth and expansion.

Bain Capital, a global private investment firm, said it has entered into definitive agreements to acquire joint control in Manappuram Finance, a Kerala-based non-banking financial company through its affiliates, BC Asia Investments XXV Ltd. and BC Asia Investments XIV Ltd. (Bain Capital). Existing promoters will continue to stay fully invested.

As part of the transaction, Bain Capital will be investing ₹4,385 crore to acquire an 18% stake on a fully diluted basis via preferential allotment of equity and warrants at a price of ₹236 per share which is at a premium of 30% over the 6 month average trading price.

The transaction will trigger a mandatory open offer for the purchase of an additional 26% stake in the company on an expanded capital basis (excluding warrants). The open offer price has been fixed at ₹236 per share.

Based on the open offer subscription, Bain Capital’s stake post the investment will vary between 18% to 41.7% on a fully diluted basis (including shares to be issued pursuant to exercise of warrants), Manappuram Finance said in an exchange filing.

Existing promoters will hold a 28.9% stake in the company post the investment on a fully diluted basis (including shares to be issued pursuant to exercise of warrants).

Manappuram Finance is India’s 2nd largest financier in the gold loan segment.

V.P. Nandakumar, MD and CEO at Manappuram Finance, said, “As we embark on the next phase of our growth, we are delighted to welcome Bain Capital as our new partner. Their leadership team is renowned for its commitment to excellence, and their sharp focus on growth will unlock fresh opportunities for Manappuram Finance.”