International private equity firm, Blackstone Group has invested Rs 150 crore in FINO Ltd to pick up a ‘significant' minority stake.

Technology solutions provider, FINO issued fresh equity shares to the US-based Blackstone.

The money will be used for scaling up business and expanding technical capability, said Mr Manish Khera, CEO, FINO.

FINO is an integrated technology solutions provider for the financial inclusion segment, catering to many Indian banks. It also offers business correspondent services.

Robust performance

“We are adding 1.5 million customers a month and have about 6 million transactions a month. We are seeing nearly 100 per cent growth year-on-year,'' Mr Khera said.

This year, FINO is looking to increase its customer base from 35 million to 50 million, he added.

“Post the transaction, Blackstone will be the largest shareholder in FINO,” said Mr Akhil Gupta, Chairman and Managing Director, Blackstone Advisors India. However, he did not disclose the stake that Blackstone will hold in FINO.

“The amount is small for Blackstone. But we are focused on the big potential the business has,'' he said

Open to raise stake

Mr Gupta said his firm is open to increasing its stake in future. Blackstone will have one seat on FINO's board.

FINO's shareholders include ICICI Group (ICICI Bank and ICICI Lombard Insurance), HSBC, IFC, Intel Corporation, Indian Bank, Corporation Bank, Union Bank of India and LIC.

ICICI Group and HSBC each hold 20 per cent stake, IFC and Intel together hold about 24 per cent stake, and the four PSU entities together hold 15-16 per cent.

Explaining the reason for seeking PE investment, Mr Rishi Gupta, CFO, FINO said, “Our investors are institutions and they have a limited appetite. PE firms, on the other hand, have more appetite for such investments.”

(This article was published on July 7, 2011)
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