In a major comeback within a short span of four years, the Anand Rathi Securities Ltd (ARSL), promoted by former president of Bombay Stock Exchange (BSE) announced that Citigroup Venture Capital International (CVCI), a leading foreign private equity player, has picked up 19.9% stake in ARSL. However, the amount at which the stake was sold to CVCI, was not disclosed by ARSL.
According to market estimates, the stake sale by ARSL may have sold the stake in the range of Rs 135-150 crore, based on the current size and products offered by it. Based on this value ARSL is valued in the range of Rs 675-750 crore. However, there was no official confirmation available on the amount as both Anand Rathi and Amit Rathi refused to comment on the issue.
Anand Rathi, chairman, ARSL said, “We are happy to have CVCI as a financial partner with us for our long term growth. Financial partnership with such a renowned international fund and extra resources will assist us in achieving faster growth. The funding will be used to further expand the company’s network of branches and create yet greater value for our customers through advanced technology.” He also said, the funds raised will be deployed for faster growth both organic, inorganic and working capital requirements.
ARSL was set up in 1994 and is one of country's fastest growing full-service securities firm with a presence in more than 350 locations across India and offices in Dubai and Bangkok. Avendus Advisors acted as financial advisors to ARSL for this deal. After being mired in a probe conducted by the Indian regulator Sebi in connection with the stock market scam of 2001, the ARSL made a resounding comeback in last couple of years.
It may be mentioned here that the Indian stock broking is passing through a vibrant phase and its not that foreing private equity players are picking up stake in the Indian securities brokerage firms but more and more foreign players are making direct entry into the industry.
Source : Financial Express