Mumbai: Former Axis Capital MD and CEO Dharmesh Mehta, along with other investors, will acquire 100% stake in IDFC Securities, the broking and research business of IDFC group.
The move comes after the previous buyer TCG Group and IDFC decided to call off their pact to sell IDFC Securities. In February, TCG Group had emerged as the buyer for IDFC Securities after a round of bidding.
"On July 25, 2019, the Board of Directors of the Company (IDFC) decided to terminate the definitive agreements signed with TCG Advisory Services Private Ltd for the sale of its entire investment in IDFC Securities Ltd, IDFC Capital (USA) Inc. and IDFC Securities Singapore Pte. Ltd, as IDFC & TCG could not reach a mutually agreeable terms and conditions," IDFC said in an exchange filing on Wednesday.
Mehta had previously bid to acquire IDFC Securities in November 2018, when the IDFC group had first initiated the process to sell the business. Other who evinced interest in the asset included former senior Edelweiss executive Vikas Khemani, and Ajay Garg, founder of Mumbai-based investment bank Equirus Capital.
However, that round of bidding was scrapped and fresh bids were called again, following which TCG group emerged as a buyer for IDFC Securities.
To be sure, IDFC is yet to sign any definitive agreement with Mehta for the sale of the business.
"The necessary definitive agreement will be signed among the parties shortly. The said transaction will conclude on the receipt of the requisite regulatory approvals," IDFC said.
The sale of IDFC Securities is part of IDFC group’s plans to sell its non-core assets. Last year, IDFC sold its infrastructure asset management business to Global Infrastructure Partners, besides its infrastructure debt fund platform to the National Infrastructure and Investment Fund (NIIF). It has also sold its private equity business to Bahrain-based asset manager Investcorp. The group was also looking to sell the IDFC Mutual Fund business last year.