E*Trade takes control of IL&FS Invest

MUMBAI: E*Trade, which raised its stake in IL&FS Investsmart by 4.5% to 23% on Monday, will bring in a new head for the Mumbai-based financial services company.

As reported by ET on Tuesday, Hemang Raja, managing director & CEO of Investsmart, has stepped down, but would continue at his position till September 1, ’06.

E*Trade has retained the management team of Investsmart. In a notice to BSE, the company, on Tuesday, said it would no longer undertake project syndication business which would henceforth be managed by IL&FS or any of its associates with effect from July 1, ’06.

IL&FS has agreed to pay non-compete fee to the company as per mutual agreement. IL&FS, the initial promoter now holding over 30% stake in Investsmart, will continue as a stakeholder.

“When all leading brokerages are increasingly involved in a lot of cross-border business, Investsmart could not attract any major business as it lacked a global business model. We are now achieving the change with definite continuity,” said a senior IL&FS official.