Bain Capital to acquire Joint Control and invest in Manappuram Finance's next Phase of Growth

Bain Capital, a leading global private investment firm, today announced that it has entered into definitive agreements to acquire joint control in Manappuram Finance, a Kerala-based non-banking financial company and the 2nd largest gold financier in India through its affiliates i.e., BC Asia Investments XXV Limited and BC Asia Investments XIV Limited (Bain Capital) in partnership with the Existing Promoters who will continue to stay fully invested. This strategic investment aims to fuel the company's next phase of growth and drive transformation by enhancing operational excellence, strengthening leadership, and expanding its presence across key segments.

As part of the transaction, Bain Capital will be investing ~INR 4,385 cr to acquire an 18.0% stake on a fully diluted basis via preferential allotment of equity & warrants at a price of INR 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 26.0% stake in the company on an expanded capital basis (excluding warrants). The open offer price has been fixed at INR 236 per share. Based on the open offer subscription, Bain Capital's stake post the investment will vary between 18.0% to 41.7% on a fully diluted basis (including shares to be issued pursuant to exercise of warrants). 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). The transaction is subject to customary closing conditions and regulatory approvals.

Founded in 1949, Manappuram Finance is a leading non-banking financial institution and the 2nd largest financier in the gold loan segment in India. It has grown to serve over 6.59 million customers through an extensive network of 5,357 branches and a workforce of 50,795 employees, who uphold its "customer-first" culture. With strong brand recognition, deep customer relationships, and a widespread presence across India, the company has successfully expanded beyond gold loans into microfinance, vehicle finance, housing finance and SME lending, establishing itself as a diversified financial services provider with significant scale and strong growth momentum.

Mr. V.P. Nandakumar, MD & CEO at Manappuram Finance, said, "The journey of Manappuram Finance has been a long and rewarding one, delivering rich dividends to all stakeholders and investors. For me personally, it has been a privilege to lead such a dynamic company that continues to set gold standards in the NBFC sector. 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. We look forward to a successful partnership that drives innovation and sustained success."

"We are thrilled to partner with Mr. Nandakumar and his team to support Manappuram Finance in its next phase of growth. This collaboration leverages our deep expertise and commitment to sustainably expanding India's financial services sector, while democratizing access to financial products that foster entrepreneurship and wealth creation across the country," said Pavninder Singh, Partner at Bain Capital. "Manappuram has developed a robust, diversified platform, and we look forward to providing the necessary capital, strategic resources, and operational expertise to help the company accelerate its growth and continue to lead in the industry."

"Manappuram Finance is a leader in the non-banking financial sector, with deep expertise and a strong market presence. Manappuram's commitment to integrity, customer-centricity, and technology-driven innovation has been key to its success, and we are excited to build on these values to further solidify its leadership in the industry," said Rishi Mandawat, Partner at Bain Capital. "There continues to be a huge opportunity for the company to accelerate growth in the core segments. We are partnering with the family to provide capital for growth and help the company on a professionalization journey that will enable it to drive better operational efficiency and risk management."

Bain Capital has deep experience in investing to support the growth and leadership of a diversified set of financial services businesses in India and globally, including Axis Bank, 360One Wealth & Asset Management, L&T Finance Holdings, Lionbridge Capital, esure, among others.

Bain Capital was advised by Kotak Investment Banking, Boston Consulting Group India, Cyril Amarchand Mangaldas, Ernst & Young LLP, Kirkland & Ellis and Unaprime Investment Advisors while Manappuram Finance, its affiliates and Existing Promoters were advised by Spark Capital and Khaitan & Co.

Shares of Manappuram Finance Limited was last trading in BSE at Rs. 217.50 as compared to the previous close of Rs. 213.95. The total number of shares traded during the day was 857132 in over 7081 trades.

The stock hit an intraday high of Rs. 220.00 and intraday low of 211.80. The net turnover during the day was Rs. 185057908.00.

Source : Equity Bulls

Keywords

ManappuramFinance INE522D01027 NBFC GoldFinancier India BainCapital JointControl