HDFC currently holds 90.88% of the equity share capital of HDFC Credila, which will become a wholly owned subsidiary, once the transaction is completed
Housing Development Finance Corp (HDFC), an Indian banking and financial services company, has unveiled its plans to acquire the remaining 9.12% stake in its subsidiary HDFC Credila Financial Services for up to INR395cr ($55m).
Under the terms of the transaction, HDFC will acquire 1,14,70,000 equity shares of each of HDFC Credila, representing 9.12% of its equity share capital, at a price of INR10 per share.
The stake will be acquired from the promoters of the company, Ajay Bohora and Anil Bohora.
HDFC currently holds 90.88% of the equity share capital of HDFC Credila on a fully diluted basis, and once the proposed transaction is completed, the firm would become its wholly-owned subsidiary.
The acquisition is expected to be completed by 31 December 2019.
In December 2009, HDFC has initially acquired a 41% equity stake in HDFC Credila from the wealth management, capital market and advisory firm DSP Merrill Lynch, said The Economic Times.
HDFC Credila provides funding for students seeking higher education
HDFC Credila is a non-banking financial company that provides loans for higher education and is claimed to be the first dedicated education loan firm in India.
Established in 2006, HDFC Credila operates through branches in cities including Mumbai, Pune, Kolkata, New Delhi, Bengaluru, Chennai and more in India. The company has generated INR603.52cr ($85m) turnover, in the year ending 31 March 2019.
HDFC Credila provides funding for students seeking higher education and offers pre-approved education loans for students before they start applying to Universities.
The firm is said to offer customised education loans with specialised focus, in-depth understanding of the requirements of students pursuing higher education.
HDFC Credila claims to have funded tens of thousands of Indian students to more than 2100 different educational institutes across 35 countries in the world.