Groww inks deal to acquire Indiabulls’ mutual fund biz for Rs 175cr

Online investment platform, Groww will acquire Indiabulls Asset Management Company from Indiabulls Housing Finance for a consideration of Rs 175 crores.

The sale of Indiabulls AMC will be limited only to the Mutual Fund business, while the Alternate Investment Fund (AIF) and Portfolio Management Service (PMS) businesses will be demerged from the existing Indiabulls AMC structure, and remain under Indiabulls Housing Finance, subject to regulatory approvals, Indiabulls Housing Finance said in an exchange filing on Tuesday.

Groww with nearly 1.5 crore customers on its platform that offers users to invest in mutual funds, stocks and exchange-traded funds (ETFs), will become one of the first

companies to enter the asset management space. SEBI’s recent change in sponsorship criteria for fintech companies to facilitate innovation, and increase reach to investors with technology-based offerings, has enabled Groww to enter into the asset management space.

Speaking on Groww’s decision to acquire Indiabulls Mutual Fund business, Lalit Keshre – CEO, and co-founder of Groww, said – “With the capability to create products, we plan to make mutual funds even more accessible – by making them simpler, more transparent, and by lowering the cost further.”

Indiabulls Housing Finance plans to grow its Real Estate Asset Management business through AIF structures in line with its asset-light strategy. While IBHFL will focus largely on retail disbursements, the AIF structure will be used for the wholesale opportunity of early-stage project finance.

According to Gagan Banga, Vice Chairman & MD, Indiabulls Housing Finance, the decision to divest retail mutual fund business is to be able to consolidate capital and provide greater focus in building the company’s real estate asset management business by way of Alternate Investment Fund, in line with the company’s asset light strategy.

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“Indiabulls Housing Finance will continue to build on its pedigree as a leading lender in the market and our AIF-driven Real Estate Asset Management business will complement our core business perfectly.”


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