Sanaka Capital, others commit to invest Rs 525 crore in Edelweiss Global Investment Advisors

Our Bureau Mumbai | Updated on November 12, 2019

Sanaka Growth SPV I Ltd, a special purpose vehicle of Sanaka Capital, will invest about Rs 308 crore in EGIA

Edelweiss Global Investment Advisors (EGIA), the investment advisory business of financial services conglomerate Edelweiss Group, has received commitments to invest Rs 525 crore ($75 million) from Sanaka Capital and certain co-investors.

Sanaka Growth SPV I Ltd, a special purpose vehicle of Sanaka Capital, will invest about Rs 308 crore in EGIA, while talks are on for another Rs 217 crore funding, Edelweiss Group said in a statement.

“Financial services in India have gained critical traction in the recent years, thanks to a young workforce that is financially and digitally savvier, and a reformative government that wants to make household savings more productive and remunerative. We look forward to working with the Sanaka team, to capitalise on emerging opportunities and take our investment advisory business to the next level,” Edelweiss Group Chairman and CEO Rashesh Shah said.

The businesses under EGIA include wealth and capital markets, asset management and asset reconstruction. The names of other investors were not immediately disclosed.

This is in line with Edelweiss Group’s overall strategic growth plan initiated in 2017 to separate its three businesses - Credit, Investment Advisory and Insurance - into separate entities. These are based on synergistic business needs, aligned consumer segments and complementary platforms.

Each business group will have its own set of investors, a ring-fenced capital base, and an independent board, it added.

The Credit and Life Insurance businesses have already established long term partnerships, with a strategic investment of Rs 1,800 crore by Caisse de depot et placement du Quebec (CDPQ) in the former and Tokio Marine’s 49 per cent holding in the latter.

With about Rs 2.04-lakh crore in customer assets, the Investment Advisory businesses have Rs 1.07 crore of assets under advice.

Sanaka Capital was founded by Shankar Narayanan, former Managing Director and Co-Head of the Asia Growth Capital team of Carlyle.

“We believe that EGIA with its focus on innovation and efficient execution would be a key beneficiary of the paradigm change in India, as savings shift towards financial products. We are confident that EGIA will capture growth opportunities through product expansion and entry into new geographies and embark on a new growth trajectory,” Narayanan said.

This investment follows that by US-based Kora Management.

Also read: US-based Kora Management to invest $125 million in Edelweiss

Published on November 12, 2019

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