Sharekhan.com, one of the first movers in the country’s online broking segment, has been acquired by French bank BNP Paribas. While the deal size was not disclosed, sources at the brokerage said the company has been valued at about ₹2,200 crore.
Mumbai-based Sharekhan offers broking solutions across all asset classes to more than 1.2 million private clients and holds 7 per cent of the market share in terms of number of accounts.
A press statement from BNP Paribas said: “Sharekhan will join BNP Paribas’ Personal Investors division, which is a key player in retail brokerage and digital banking services with 1.7 million clients in Europe.”
All staff and clients at Sharekhan will be absorbed into BNP Paribas. The completion of the transaction is subject to regulatory approvals.
India platform Joris Dierckx, Country Head, BNP Paribas India, said in the press release: “Sharekhan will serve as a platform for the group’s strategy in India to offer a comprehensive range of products from pure brokerage to asset-based investment services, including mutual funds and savings products.”
“The purchase of Sharekhan is a unique opportunity for us to build on our achievements in the Indian market and to further expand our business in India”
It was earlier reported that IndusInd Bank and a team-up of private equity firms Warburg Pincus and Great Atlantic were in the running to acquire the Indian firm.
Sharekhan’s final valuation is at roughly 1.7 times its net worth.
Stake in Geojit In 2007, BNP Paribas had acquired a 34.5 per cent stake in another brokerage house, Kochi-based Geojit Financial Services Ltd, now known as Geojit BNP Paribas Financial Services Ltd.
Industry sources suggest that the two firms — Geojit BNP Paribas and Sharekhan as part of BNP Paribas — will function independently. Sharekhan has a branch and franchisee network across India and an office in Dubai, while Geojit BNP Paribas is concentrated in South India and West Asia.
It would appear the two entities will compete in the broking business since BNP Paribas will continue to stay invested in Geojit as well.
Shares of Geojit BNP Paribas moved up 12.44 per cent on the BSE on Thursday to close at ₹51.05.
Law firm Cyril Amarchand Mangaldas represented BNP Paribas while AZB and Partners represented the selling group.