The Foreign Investment and Promotion Board (FIPB) has approved a proposal of Cloverdell Investment to invest in Future Capital Holding.

However, the board deferred the various proposals barring one related with pharmaceuticals and health & family welfare sector.

Official sources said that in its meeting on Friday, the FIPB approved the proposal of Cloverdell Investment, which is an affiliate of Warburg Pincus. The company has a plan to pick up a maximum of 53.67 per cent stake in Future Capital Holdings Ltd in two tranches. The acquirer would pay Rs 162 a share which is about Rs 15 more than the current market price of the scrip.

Earlier on June 4, Pantaloon Retail (India) Ltd and its wholly owned subsidiary Future Value Retail Ltd informed the stock exchanges that they had entered into a Share Purchase Agreement (SPA) with Cloverdell to sell their stake in Future Capital Holdings Ltd (FCH) in two tranches representing a maximum of 53.67 per cent but subject to a minimum of 40 per cent of the equity.

FCHL is a non-deposit accepting registered NBFC listed on BSE and NSE. The SPA and resolution passed by FCH Board to make preferential allotment of equity shares and/or convertible securities of around Rs 100 crore to the purchaser will require the acquirer to make an open offer under the SEBI regulations. 

Cloverdell, in its submission to FIPB, proposed, “Induction of foreign equity in an operating NBFC with downstream investments in companies engaged in/proposed to be engaged, inter alia, in the business of housing finance, stock broking (including derivatives and currency derivatives broking), depository participant service, commodity broking and investment advisory activities.”

This proposal was deferred by the FIPB on June 29.

Pharma Proposals

The FIPB also considered nine proposals related to Pharmaceuticals, Health & Family Welfare. But due to lack of clarity in the foreign direct investment (FDI) policy in pharma sector, except one, all proposals were deferred.

The source, however, refused to divulge details about the proposal which was cleared.


(This article was published in the Business Line print edition dated July 30, 2012)
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