Centrum Group, a diversified financial services group, has signed an agreement to sell its foreign exchange business, Centrum Direct (CDL), to US-based Ebix Inc for ₹1,200 crore. The Indian company will also transfer the entire CDL team and assets to Ebix, which will become part of the Atlanta-based company’s financial exchange, EbixCash.
This follows Centrum Group’s 2017 divestment of an 18.5 per cent stake in CDL to a group of private equity investors, such as Jacob Ballas, New York Life and Evolvence.
“With more customers opting for technology-enabled platforms, Ebix has the right technological capabilities, a global footprint and a large resource base, to make an ideal home for CDL. The combined strengths of both entities, I believe, will set the foundation of a strong business opportunity,” Jaspal Bindra, Executive Chairman, Centrum Group, said.
“The sale proceeds will provide Centrum Group with a significant resource base to strengthen our core businesses of wealth management, institutional and retail broking, investment banking, insurance and our lending verticals, along with identifying strategic opportunities for growth,” he added.
₹10,000 cr worth transaction
In FY18, CDL handled transactions worth ₹10,000 crore, while it has a customer base of over 30 lakh as of date. The company’s services include sale and purchase of foreign currency, overseas remittances, pre-paid travel cards and travellers cheques.
CDL has a nationwide network of 165 outlets in 55 cities and is the largest airport forex player with presence at 24 airports in India.
“The acquisition of CDL provides us with new abilities in niche financial exchange sectors while expanding our footprint in India.
“We have been eager to take up a strong position in India’s airports and shipping ports. CDL has a strong financial trajectory in terms of topline and operating margins,” Robin Raina, Chairman, President and CEO at Ebix, said.
The deal, which has been approved by the Centrum Board, is subject to shareholder and other regulatory approvals.