TPG Capital may exit Shriram Transport, enter Shriram Capital

MUMBAI: US-based private equity major TPG Capital, which holds a 20 per cent stake in Shriram Transport Finance (STF), is likely exit the NBFC and may invest Rs 1,000 crore in Shriram Capital, also a part of the diversified financial services Group.

"The private equity firm (TPG Capital) is likely to exit...but the firm has promised to invest in another of our company - Shriram Capital," STF Deputy Managing Director Umesh Revankar told PTI here.

"TPG may invest about Rs 1,000 crore in Shriram Capital for around 15 per cent stake," he said.

TPG Capital holds a 20 per cent stake in Shriram Transport Finance, a non-banking finance company (NBFC). TPG has appointed Credit Suisse to advise it on the exit strategy.

According to reports, the Singapore-based investment company Temasek Holdings is in talks with TPG Capital to buy a part of its stake in Shriram Transport Finance.

"The private equity firm has not informed us (about selling its stake). But I can say TPG has appointed Credit Suisse as a consultant to explore the option to sell its stake," Revankar said.

STF is the vehicle finance arm of the Shriram Group and funds purchase of mostly second-hand trucks by small operators. The company has a loan-book of Rs 35,000 crore.

Shriram Group is one of the most diversified financial services entites in the country with business interests in asset financing, life insurance and retail finance. It had also expressed interest in entering the banking space.