Muthoot Finance, the largest gold loan non-banking finance company in the country, on Friday entered into a definitive agreement to acquire IDBI Asset Management and IDBI Mutual Fund Trustee Company, paving way for its entry into the mutual fund asset management space.
"Upon completion of the transaction, Muthoot Finance will purchase 100 per cent equity shares of IDBI Asset Management and IDBI MF Trustee for a total consideration of Rs 215 crore," according to an official statement.
The transaction is expected to be completed by the end of February 2020. Upon closing, both IDBI Asset Management and IDBI MF Trustee will become wholly-owned subsidiaries of Muthoot Finance.
The deal is subject to receipt of approval from regulators including the Securities and Exchange Board of India (SEBI).
"We are excited to venture into this new path in the financial services space," said George Alexander Muthoot, Managing Director of Muthoot Finance. "We are equally excited to partner with the strong, experienced and enthusiastic management team at IDBI Mutual Fund as we embark upon the next level of our journey."
Promoted by IDBI Bank in 2010, IDBI Mutual Fund is one of the profit-making asset management companies in the mutual fund space with assets under management of Rs 5,300 crore. IDBI Mutual Fund runs 22 schemes with robust assets under management across products, geography and investors.