Mumbai: American private equity firm Warburg Pincus said on Saturday that it had entered into definitive agreement to acquire 80% stake in Avanse Financial Services Ltd from Wadhavan Global Capital group, the PE firm said in a statement.
Financial details of the transaction were not disclosed.
Avanse is an education focused Non Bank Finance Company (NBFC), set up in 2013, which has funded over 15,000 students across 6,000 courses in over 2,000 institutions across India and over 45 countries, the statement said. Avanse has also funded over 300 educational institutions covering over 7 lakh students.
As part of the transaction, Warburg Pincus plans to infuse ₹300 crore primary equity capital into Avanse to fund its future growth.
Wadhavan Global 's stake sale in Avanse follows it's sale of its affordable housing finance business Aadhaar Housing Finance to PE firm Blackstone Group Lp for around Rs3,000 crore in February, as part of its plans to tide over liquidity issues following the NBFC liquidity crisis that hit the sector in September after Infrastructure Leasing & Financial Services group defaulted on debt payments.
“We believe that education is an important priority for India, and specialised lenders, like Avanse, will play a strong role in helping meet aspirations of young Indians. Warburg Pincus has a deep history in backing talented management teams, particularly within financial services. The planned primary capital infusion in Avanse will meaningfully expand the company’s net worth," said Vishal Mahadevia, managing director and India Head at Warburg Pincus.
Avanse has assets under management in excess of ₹2,900 crore. Ernst & Young served as the financial advisor for the transaction.
