Manappuram Finance Set to Acquire NBFC

Thrissur (Kerala): Manappuram Finance Ltd., the Kerala based NBFC, has announced its intention to acquire the Hyderabad based NBFC, Indian School Finance Company Pvt. Ltd. (ISFC), that focuses on lending to the education segment with loans to affordable private schools, vocational colleges, coaching centres etc.

The announcement followed a meeting of the Board of Directors of the company held at Valapad (Thrissur District) on July 02, 2018. The company has agreed to enter into binding agreements with ISFC and its shareholders, for acquiring 85.39 percent stake by way of secondary purchase from the existing financial investors, Gray Matters Capital and Caspian.

ISFC has assets under management (AUM) of Rs.522.59 crore and shareholders’ funds of INR 90 crore (including compulsorily convertible instruments) as of March 31, 2018. ISFC has served over 2.6 million students through approximately 4500+ institutions since its inception. The Company has a country-wide footprint spanning 116 locations across 15 states in India through a hub & spoke model, with an employee base of over 300. Under the leadership of Neeraj Sharma (MD & CEO), ISFC has developed strong underwriting and risk management processes for lending to the ecosystem of educational institutions.

In a statement to the media, Mr. V.P. Nandakumar, MD & CEO of Manappuram Finance Ltd., said, “As a niche player, we expect ISFC’s business to be both scalable and profitable. We believe this acquisition will enable Manappuram Finance to grow faster and thereby help us achieve greater diversification.”

This deal is subject to satisfactory completion of documentation and customary closing conditions, including regulatory approval(s).  Ernst & Young LLP acted as an exclusive financial advisor and Cyril Amarchand Mangaldas acted as legal advisor to Manappuram Finance Ltd. for this deal.

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