Buyout firms Bain Capital, Baring Asia, Centrum, Chrys Capital and KKR are among the investors bidding for a majority stake in affordable housing lender Aadhaar Housing Finance owned by Wadhwan Group, multiple sources familiar with the matter told ET.
As per the indicative offers, the investors will acquire 51% stake valuing the housing finance firm at around Rs 1,500-2,000 crore. If the deal is struck, it could ease liquidity pressure on parent Dewan Housing Finance, a group company.
“We do not comment on market speculation,” said a spokesperson from Wadhwan Global Capital responding to ET’s query. Bain Capital, Baring Asia and Centrum group declined to comment, while an email sent to Chrys Capital didn’t elicit a reply at the time of publication.
“The last date for bidding has been extended from November 14 from November 7. The company already received non-binding bids from this private equity and strategic players,” said one of the persons cited above. The company is expected to shortlist bids after Wednesday. WGC holds about 70% in the company while International Finance Corporation, an arm of World Bank, owns 17%. DHFL, the flagship company of the group, too has a stake.
As a significant majority stake will be sold directly by promoters, many investors have shown interest. The future of housing finance remains bright, sources said. The government is pursuing the ‘Housing for All’ project by 2022 which has given a fillip to low-cost housing in the country. Aadhar Housing has a loan book of about Rs 8,500 crore.
Also, the book quality is high and it has a wide network of nearly 300 branches across the country in small towns and cities. This is the second largest loan book after Gruh Finance in the affordable housing segment, said another source involved in the stake sale process. Such loans indicate little sign of turning bad in future. However, there is a need to strengthen the technology and corporate governance standards in the company, the person said.
