HSBC to acquire majority stake in IL&FS InvestmartMay 17th, 2008 - 10:48 pm ICT by admin
Mumbai, May 17 (IANS) The Hong Kong and Shanghai Banking Corporation Ltd (HSBC) is set to acquire through its group subsidiaries a major stake in India’s leading retail brokerage house IL&FS Investsmart Ltd (IIL). The acquisition amounting to 73.21 percent of IIL is awaiting approval from regulatory bodies.
HSBC will be making the acquisition through group subsidiaries, including HSBC Securities and Capital Markets (India) Private Limited, its securities arm in India.
Announcing this here Saturday, an HSBC spokesperson told IANS that 43.85 percent stake would be acquired from E*TRADE Mauritius Ltd, an indirectly wholly-owned subsidiary of E*TRADE Financial Corporation.
“The additional 29.36 percent would be acquired from Infrastructure Leasing and Financial Services Limited (IL&FS.) Both shareholders will receive a price of Rs.200 per share for their respective stakes, making a total consideration of Rs.100 billion (approximately $241.6 million).
“In addition to this, IL&FS will be paid, as part of a three-year non-compete agreement, Rs.820.1 million (approximately $19.4 million).”
The spokesperson said HSBC will also make an open offer to acquire up to 20 percent of the remaining shares in IIL.
With a market capitalisation of approximately $300 million, IIL is listed on the National Stock Exchange and the Bombay Stock Exchange and its global depository shares are listed on the Luxembourg Stock Exchange.
In an official statement, HSBC’s group managing director and CEO (Asia Pacific) Sandy Flockhart said the investment for this acquisition “gives a foothold in one of the largest retail broking markets in the world”.
“With over 20 million retail investors, India has the world’s third largest investor base and its National and Bombay stock exchanges are respectively the third and fifth largest stock exchanges globally by transaction volume,” Flockhart said.
HSBC Global Banking and Markets chief executive Stuart Gulliver stated the acquisition “fits with the strategy and leverages of HSBC’s global distribution capabilities. We will benefit from an expanded institutional broking, equity capital markets and investment banking platform.”
HSBC India group general manager and CEO Naina Lal Kidwai added: “Investsmart’s local expertise and strong management team will play a key role in strengthening our service proposition in India.”
- HSBC InvestDirect plans to delist from Indian bourses - Oct 09, 2009
- Surya Pharma's arm acquires US's ActivOn for $22 mn - Dec 28, 2010
- IL&FS investment banking arm launches UK operations - Nov 04, 2009
- Reliance Capital gets regulator's nod to sell stakes to Nippon Life - Jun 13, 2012
- Carborundum Universal turns acquisitive in South Africa - Jun 19, 2012
- UKIBC in talks with Indian corporates to train staff - Sep 12, 2011
- Thomas Cook's India business up for sale - Feb 08, 2012
- Mahindra Satyam to acquire minority stake in Dion Global - Feb 10, 2012
- India's first bamboo park in Tripura - Apr 06, 2011
- TVS group acquires Britain-based firm - Mar 27, 2012
- Cairn India shares only moderately up day after stake sale - Apr 20, 2011
- RIL acquires 14.12 percent in East India Hotels - Aug 30, 2010
- Tatas now acquire British Salt for $144.6 million - Dec 20, 2010
- Capitol One to acquire HSBC's domestic credit card business for $2.6 billion - Aug 10, 2011
- Polaris Software acquires US firm for $20 mn - Apr 27, 2011
Tags: majority stake