HDFC sells education loan arm Credila for Rs 9,060 cr

A consortium of private equity firms, including ChrysCapital, has acquired a 90% stake in HDFC Credila Financial Services for Rs 9,060 crore, HDFC Ltd said.

Deal dynamics

• A consortium of private equity firms, including ChrysCapital, has acquired 90% stake in the company
• Total revenue of HDFC Credila during FY23 was Rs 1,352.18 crore and its net worth as on March 31, 2023 was Rs 2,435.09 cr
• HDFC will retain a 9.99% stake in HDFC Credila, which provides education loans to students pursuing higher education in India and overseas

The sale of HDFC Credila, the education loan arm of Housing Development and Finance Corporation (HDFC), comes ahead of the completion of HDFC’s merger with HDFC Bank.

“HDFC Ltd, HDFC Bank Ltd and HDFC Credila Financial Services Ltd today announced they have entered into definitive agreements to sell a majority stake in HDFC Credila to an investor consortium of BPEA EQT and ChrysCapital,” HDFC said in a stock exchange filing on Tuesday.

The PE consortium include Kopvoorn B.V., Moss Investments Ltd, Defati Investments Holding B.V. and Infinity Partners.

Kopvoorn B.V. is part of the BPEA EQT group, and Moss Investments, Defati Investments Holding B.V. and Infinity Partners are part of the ChrysCapital group, HDFC said in a late night regulatory filing on Monday.

“The consortium valued HDFC lender at a pre-money valuation of Rs 10,350 crore and will infuse primary proceeds of Rs 2,000 crore into the company,” HDFC said.

HDFC Ltd has signed a definitive agreement to sell 90% stake in its education loan arm HDFC Credila to BPEA EQT and CrysCapital Group for a consideration of Rs 9,060 crore.

HDFC executed definitive documents on June 19 for the proposed sale of about 13,29,49,207 equity shares of HDFC Credila, representing about 90% of Credila’s issued and paid-up share capital as of date to the acquirers, HDFC said in an exchange filing.

After to the proposed transaction, HDFC Credila will cease to be a subsidiary of HDFC, and its shareholding in HDFC lender will be less than 10% of HDFC Credila’s total issued and paid-up share capital. It reported total revenue of Rs 1,352crore, and a net worth of Rs 2,435.09 crore as of March 31, 2023. The transaction is subject to regulatory approvals and is likely to be completed within 15 days from the completion of all conditions precedent or such other date.

With Thanks Reference To : https://www.tribuneindia.com/news/business/hdfc-sells-education-loan-arm-credila-for-9-060-cr-518964 & (The New India Express) https://www.newindianexpress.com/business/2023/jun/20/hdfc-to-sell-90-per-centstake-in-education-loan-arm-hdfc-credila-for-rs-9000-crore-2586754.html