IIFL Finance board to weigh Blackstone, Advent proposals for Rs 5,000 crore capital raise

The board of IIFL Finance will meet on Tuesday to consider proposals for a fresh capital infusion of nearly Rs 5,000 crore. The board will evaluate separate proposals from private equity firms Blackstone and Advent International, said people with knowledge of the matter.

Nirmal Jain-promoted IIFL Finance had told ET in an interview on October 19 that it planned to raise up to Rs 5,000 crore by selling a 10-20% stake to a minority investor, while promoters could subscribe to warrants to limit dilution.

Also Read: IIFL Finance plans to raise ₹2,500-5,000 crore by selling stake amid Fairfax exit rumors


Separately, Prem Watsa-promoted Fairfax Financial Holdings is set to exit IIFL Finance by selling its 13.7% stake to an investor as part of a deal linked to the acquisition of a majority stake in IDBI Bank under the government's disinvestment programme.

ET had reported on September 10 that Advent was in the fray, along with Singapore's Temasek Holdings, to acquire a 15% stake in IIFL Finance.

It remains unclear whether the same investor could inject fresh capital into the company and also acquire Fairfax's existing stake. Jain had told ET that an investor could negotiate simultaneously with both the company and Watsa, making it a combined transaction. Any deal would ultimately depend on the private equity investor's preference, he had said, declining to share further details.

Also Read: Fairfax plans IIFL Finance exit to fund IDBI Bank bid

Last October, Blackstone, through its affiliate Asia II Topco XIII Pte. Ltd., announced a Rs 6,196.5 crore investment in Federal Bank to acquire up to a 9.99% stake.

Advent International expanded its presence in India's BFSI sector by acquiring a stake in Yes Bank, which now stands at 8.5%, and later buying a 14% stake in Aditya Birla Housing Finance. It has also invested in Svatantra Microfin, an IPO-bound microfinance lender, and KreditBee, a fintech platform.

Responses from IIFL Finance, Blackstone and Advent to queries on the matter are awaited.