South Korea based investment company Arum Holdings will invest Rs 225 crore into Belstar Microfinance Limited (BML), a subsidiary of Kerala-based Muthoot Finance.
BML has obtained the approval from the Reserve Bank of India for a primary equity infusion of Rs 275 crore.
The microfinance lender has currently 720 branches, 1.6 million active customers and Rs 4100 crore of assets under management.
Muthoot Finance currently holds 70.01% stake in the microfinance institution and after the infusion it will be diluted to 60.69%.Arum will hold 14.51% stake in the lender post the equity infusion. Maj Invest, a Danish asset management company, holds 11% stake in BML.
The microfinance company reported a loan portfolio of Rs 3,836 crore for Q3 of FY22, a growth of 33% year-on-year and a net profit of Rs 12 crore for the quarter. During Q3 FY22, the loan portfolio increased by Rs 482 crores and Stage III Asset as percentage of Gross Loan Asset stood at 5.54% as of December 31, 2021 as compared to 3.61% as of September 30, 2021.
Belstar along with its promoters, Arum Holdings Limited, MAJ Invest Financial Inclusion Fund II K/S, and Muthoot Finance have signed an amended shareholders agreement to give effect to said infusion of capital and a secondary offer for sale by promoters for a total consideration of Rs 20 crore.
