In one other consolidation within the mutual fund phase, L&T Finance Holdings has proposed to promote its mutual fund enterprise, L&T Investment Management Ltd (LTIM), to HSBC Asset Management (India) Ltd for $425 million (round Rs 3,200 crore). LTIM will ultimately be merged with HSBC’s asset administration enterprise in India.
Both the businesses have entered right into a definitive settlement whereby HSBC AMC will purchase 100 per cent fairness shares of L&T Investment Management Ltd, a completely owned subsidiary of L&T Finance Holdings (LTFH), which is the funding supervisor of L&T Mutual Fund.
L&T MF has belongings beneath administration of Rs 80,000 crore. HSBC intends to merge the operations of LTIM with that of its present asset administration enterprise in India, which had belongings beneath administration (AUM) of Rs 11,700 crore as of September 2021.
LTFH can even be entitled to extra money in LTIM till the completion of the acquisition. “The transaction is subject to the requisite regulatory approvals. Both LTIM and HSBC AMC will work to ensure that there will be continuity of services to their investors and counter-parties in the interim,” LTFH stated in an announcement.
The divestment of the mutual fund enterprise is consistent with the strategic goal of L&T Finance Holdings of unlocking worth from its subsidiaries to strengthen its steadiness sheet, it stated.
Dinanath Dubhashi, MD & CEO, L&T Finance Holdings, stated, “The transaction with HSBC is in line with our strategic objective of unlocking value from our subsidiaries which will help us to strengthen our balance sheet for our lending business…”
