Home / Companies / FTIL sells warehousing arm to India Value Fund

Mumbai: Financial Technologies (India) Ltd (FTIL) said on Friday that it was selling its entire holding in its warehousing subsidiary, National Bulk Handling Corp. Ltd (NBHC), to IVF Trustee Co. Pvt. Ltd, the sole trustee of private equity firm India Value Fund (IVF) IV, for 241.74 crore.

“The transaction is subject to certain customary closing conditions including the approval of shareholders of FTIL," FTIL said in a statement. It added the transaction is likely to be completed between 15 April and 30 April, subject to shareholders’ approval by way of postal ballot.

The purchase of 100% of NBHC from FTIL and other shareholders is the first investment in the agricultural warehousing space by India Value Fund Advisors (IVFA).

IVFA focuses on mid-sized businesses and is known as a turnaround specialist.

So far, the investment firm has launched four separate investment funds with a combined corpus of over $1.2 billion and is currently investing out of IVF IV, which has a corpus of $600 million.

Since 1999, it has invested in over 26 businesses, including Meru Cab Company Pvt. Ltd, Manipal Hospitals, Trivitron Healthcare Pvt. Ltd and VKL Seasoning Pvt. Ltd.

“The agri warehousing industry is a very interesting segment and is growing very fast," said Vikram Nirula, partner at IVFA, adding that no changes are in the offing for NBHC’S business plans and strategies for now.

NBHC is engaged in the business of offering warehousing solutions in commodity and collateral management along with its stakeholders FTIL, State Bank of India and commodity bourse Multi Commodity Exchange of India Ltd (MCX).

According to an NBHC statement in September, it managed about 5,500 crore worth of stocks, of which about 4,200 crore are funded by banks to the respective commodity owners such as farmers, processors and traders.

NBHC also acts as a warehousing service provider for MCX, which accounted for about 5-7% of the former’s total stock usually, according to NBHC’s earlier statement.

NBHC manages at least 1,140 warehouses across India, which are used for storage of various commodities on behalf of its clients.

FTIL had in November sold its subsidiary Singapore Mercantile Exchange to IntercontinentalExchange Group Inc. for $150 million. FTIL had said in a statement that it will use the proceeds to repay foreign currency loans.

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