Money & Banking

Upset over deal with Axis Bank, Spandana MD Gangireddy quits

Our Bureau | | Updated on: Nov 03, 2021

Another spat between an investor and founder has erupted after the recent dispute between promoters of Zee Entertainment and Invesco. Spandana Sphoorty Financial’s Founder and Managing Director Padmaja Gangireddy has resigned from the microfinance lender following a disagreement with private equity investor Kedaara Capital over a proposal to sell the company to Axis Bank. Reddy has 17 per cent stake in the company while Kedaara holds 45 per cent.

According to Gangireddy, Kedaara wants to sell the country’s second-largest microfinance entity to Axis Bank at a throwaway price. “I opposed underselling of the company to Axis Bank at a throwaway price. While other MFIs were acquired at 4.75x and 3,5x BV multiples in the past few months, Kedaara wanted to sell Spandana at 1.6x, which is one-third of other company’s valuation. They are hell-bent on selling the company for their personal benefits,” Gangireddy said in a letter to the employees.

While Axis and Kedaara are yet to comment on Gangireddy’s claims, the company said in a statement that the board of directors has accepted Gangireddy’s resignation. KR Kamath, former Chairman & Managing Director of Punjab National Bank and board member of Spandana, will chair the management committee. “The board confirmed the hiring of an eminent industry veteran as its new MD & CEO,” the statement said without naming the executive. Industry sources said that Shalabh Saxena, MD & CEO of Bharat Financial Inclusion Ltd, could be appointed as the new CEO of Spandana.

Published on November 03, 2021
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