KKR’s interest in Aadhar Housing Finance comes at a time when NBFCs are facing pressure due to liquidity concerns, high valuations, and asset-liability mismatches.
Moneycontrol News
US-based private equity fund KKR is in talks to acquire a controlling stake in Aadhar Housing Finance, according to a Mint report.
The affordable-housing finance company is a subsidiary of Wadhawan Global Capital (WGC), which also controls Dewan Housing Finance Corporation (DHFL).
“KKR may look to acquire the company at a discount to its present price to book value,” a source told Mint.
An initial public offering (IPO) or strategic stake sale of Aadhar Housing Finance has been in the works for a while now to “unlock value”, a spokesperson for Wadhawan Global Capital told the publication.
Mint said KKR declined to comment. Moneycontrol could not independently verify the story.
International Finance Corp, an investment arm of the World Bank, owns about 16.91 percent of Aadhar Housing Finance as on March 31, 2018, according to corporate filings viewed by the paper.
WGC, DHFL, and members of the Wadhawan family together hold a 79 percent stake in the company.
KKR’s interest in Aadhar Housing Finance comes at a time when non-banking financial companies (NBFCs) are facing pressure due to liquidity concerns, high valuations, and asset-liability mismatches.
The crisis in the NBFC sector was triggered by a series of defaults on payments by Infrastructure Leasing and Financial Services (IL&FS).
KRR is also looking at acquiring assets from stressed Indian lenders, and is eyeing acquisition of non-bank lenders, according to a Bloomberg report.
The disruption in the space led to a massive sell-off in NBFC stocks. Shares of DHFL have plunged 61.2 percent since September 17, led by a one-day sell-off triggered after a fund house, looking to raise capital, sold the company's papers at a massive discount.
