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Our Bureau

Mumbai , Jan. 16

FARALLON Capital and its affiliates will invest over Rs 200 crore in equity capital in Indiabulls Financial Services' two subsidiaries - Indiabulls Credit Services and Indiabulls Housing Finance.

Indiabulls, in turn, will invest around Rs 260 crore in these two subsidiaries. This follows the Rs 88-crore investment that Farallon Capital had made in Indiabulls Credit Services in January 2005, bringing the total investments by Farallon Capital in these companies to around Rs 290 crore.

Farallon is a registered investment adviser with the US Securities and Exchange Commission and manages over $17 billion in equity capital invested across the world in many different asset classes.

The housing finance subsidiary of Indiabulls is engaged in the business of providing home loans and loans against property, Indiabulls Credit Services is focused on providing consumer loans to underserved middle markets and the segment that is unable to access credit from banks.

Indiabulls stock rose 7.67 per cent at Rs 209.80 on BSE today.

Farallon will invest Rs 112.5 crore as equity capital in the housing finance subsidiary of Indiabulls Financial Services for one-third of the company, valuing the company at Rs 337 crore, the company said in a release. The housing finance subsidiary will issue 4.5 crore shares to Farallon at a price of Rs 25 per share for the Rs 10-face value share.

Indiabulls Financial Services will invest an additional Rs 80 crore and will retain management control.

Farallon will also make a follow-on investment of Rs 89.1 crore in the equity capital of Indiabulls Credit Services. Farallon will pay Rs 55 per share for the Rs 10 face value share for additional 1.6 crore shares in Indiabulls Credit Services. Farallon had earlier paid Rs 22 per share and invested a total of Rs 88 crore for 33 per cent stake in Indiabulls Credit Services. Alongside, Indiabulls Financial Services will invest Rs 178 crore in the company for an additional 3.2 crore shares

Post the new investments, the shareholding of Indiabulls Financial Services in Indiabulls Credit Services will increase from 50.7 per cent to 55.3 per cent and shareholding of Farallon will remain unchanged at 33.3 per cent.

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