Temasek To Invest Rs 300 Cr (US$60 Mil) In India's Micro
Finance Institution Spandana Sphoorty Financial Ltd
http://www.vccircle.com/500/news/temasek-to-close-rs-300-cr-investment-in-spandana
Vccircle.com, 3 Sep 2009
Temasek To Close Rs 300 Cr Investment
In Spandana
Singapore government-sponsored
investment house Temasek Holdings is close to investing $60 million
or Rs 300 crore in Hyderabad based Spandana Sphoorty Financial
Ltd. According to sources, the deal is being closed
at $400 million or Rs 2,000 crore valuation.
VCCircle had reported last week, quoting Spandana's CEO Padmaja
Reddy, that the microfinance
institution would be closing a $60 million deal this
week. When contacted, Manish Kejriwal, Senior
Investment Director, India & International, Temasek Holdings,
told VCCircle, “We haven’t closed the deal.” Reddy was not
available for a comment.
If the deal goes through, this
would be third investment by Temasek in financial services space.
It had earlier invested in non banking financial services company
Fullerton India and also in ICICI Bank.
In Spandana, Temasek could be buying out half the stake of Lok
Capital, which holds 5% stake in Spandana. Lok Capital is looking
at divesting 50% of its interest, Reddy had told VCCircle last
week. The other stakeholders in Spandana include JM Financial PE
fund (18%), Valiant (11%) and senior employees (15%).
Spandana, like many other MFIs like SKS Microfinance, has been
aggressive on the capital-raising front. It has already raised debt to fund its
growth plans. In
June, it raised Rs 80 crore via non-convertible debentures. Also,
it recently concluded Rs 50-crore ($12 million) loan deal with Rabo
Bank, a Dutch cooperative.
Private equity and venture capital investors have taken a serious
shine to the MFI sector, although there is a refrain that the sector is
overvalued.
Earlier this year, SKS Microfinance raised Rs 75 crore ($15.8
million) through a one-year non-convertible debenture issue at a
coupon rate of 10%. In late 2008, SKS raised Rs 366 crore ($75
million) with investments from Sandstone Capital, Kismet Capital
and SVB India Capital partners. Fellow Andhra Pradesh MFI player
Share Microfin is also in the process of raising $50 million from
International Finance Corporation, the private equity fund of World
Bank, and others. In April, Bhartiya Samruddhi Finance Ltd raised
$10 million.
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