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State Bank of India (SBI), the Carlyle Group and GE have announced that they have signed definitive agreements, whereby SBI and Carlyle Group will acquire GE Capital's entire stake in SBI Card, the second-largest credit card franchise in India.
SBI Card is operated through two joint venture companies , SBI Cards & Payment Services and GE Capital Business Process Management Services, which issue credit cards and process card transactions in the Indian market.
Following the transactions, SBI and Carlyle will own 74 percent and 26 percent respectively in each of the two entities.
The transaction is expected to close by the fourth quarter of 2017, subject to regulatory approvals, according to Carlyle Group.
Carlyle's equity for this transaction will come from an affiliated entity of Carlyle Asia Partners IV, Carlyle's fourth Asia buyout fund focusing on control and significant minority investments in well established companies across the Asia ex-Japan region.
Currently, SBI holds 60 percent in SBI Cards & Payment Services and 40 percent in GE Capital Business Process Management.
SBI had already announced its intent to raise its stake to 74 percent from 60 percent in the front -end entity and to 74 percent from 40 percent in the back -end entity.
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