Big bang IPO next on mind, but first IIFL Wealth Management raises Rs746 crore by private sale of 5.1% stake

IIFL Wealth Management, a subsidiary of IIFL Holdings, has issued nearly 44.90 lakh shares to a set of financial investors to raise Rs745.71 crore by selling 5.1 percent stake. The shares were issued by the wealth management arm of IIFL Holdings to WF Asian Reconnaissance Fund, Rimco (Mauritius) Limited, Amansa Holdings, General Atlantic Singapore Fund, Steadview and HDFC Standard Life Insurance. Post this transaction, IIFL Holdings will hold 51.11 percent in its wealth management arm on a fully diluted basis.

The board of directors of the company and its wealth management subsidiary, IIFL Wealth Management Limited, approved the issue and allotment of 44,89,500 equity shares of IIFLW at a price of Rs 1,661 per equity share for a total consideration of Rs 745.71 crores at a meeting held yesterday and the share sale will translate to nearly 5.1 percent of the diluted post closing share capital of the company,  IIFL Holdings said yesterday in an exchange filing.

"Our wealth business continues to benefit from the underlying positive trends in the financial services sector which has enabled us to increase our asset base by over 30% last year. This investment by several renowned marquee investors will help us further grow our platform and enhance our leadership position in this space," Nirmal Jain, Chairman, IIFL said.

The listing of IIFL wealth may happen in the next 8-12 months, he told CNBC TV18. The funds have been raised for expansion of AMC and wealth NBFC business, Nirmal Jain added. A vacuum has been created due to non-lending by the public sector banks, he also said.

"The phenomenal growth in our wealth management assets and Alternative Investment Funds have been the key catalysts in our growth over the last 2 years. This investment further enhances our ability to expand both organically as well as inorganically across geographies while also enabling us to improve our credit platform and serve as a sponsor to our rapidly growing AIF schemes," Karan Bhagat, MD & CEO, IIFL Wealth Management Ltd said.