The Hindu Business Line : TPG Newbridge may invest in Shriram City Union

TPG Newbridge may invest $150 million for a 49 per cent stake in a company that will be created to hold 100 per cent of the equity capital of Shriram City Union Finance, it is reliably learnt.

The arrangement is similar to the one that was made in 2005, when Newbridge picked up 49 per cent equity in Shriram Holdings (Madras) Pvt Ltd, a company that holds the majority stake in Shriram Transport Finance Company.

While sources in the Shriram group declined to comment, sources in Newbridge said that talks were going on between the investor and the groupsome time ago. But they said that as Shriram City had recently raised funds from ChrysCapital, Bessemmer and ICICI Ventures, the company may not need funding from Newbridge. However, sources in the know said that the deal was likely to happen shortly.

Shriram Transport Finance is into financing purchase of trucks, predominantly used trucks. Shriram City Union is into consumer financing. Meanwhile, Shriram City on Friday announced that Shriram Retail Holdings Pvt Ltd has bought 12.21 per cent stake in Shriram City from another group entity, Shriram Capital (formerly known as Shriram Financial Services Holdings Ltd).

The stock of Shriram City Union jumped on Tuesday to Rs 400 but closed at Rs 364, down 3.38 per cent over the previous day’s close.

M. Ramesh