Serum Institute of India's Adar Poonawalla-controlled Rising Sun Holdings is all set to acquire a 60 per cent stake in non-banking financial company (NBFC) Magma Fincorp by subscribing to a Rs 3,456-crore preferential issue. After the infusion of capital, Magma and its subsidiaries will be renamed and rebranded Poonawalla Finance.
Magma Fincorp proposes to allot 45.8 crore shares to Rising Sun Holdings, and 3.57 crore shares to Sanjay Chamria and Mayank Poddar, the existing promoters. Rising Sun Holdings will hold 60 per cent stake in the non-bank lender after the transaction is completed, while the current promoter shareholding will come down to 13.3 per cent. The net worth of MFL will increase to over Rs 6,300 crore, a statement said.
Poonawalla is also the CEO of Serum Institute of India, the maker of Oxford University-AstraZeneca Covishield vaccine in India. Rising Sun Holdings intends to appoint him as the chairman of the board of the lender, while Abhay Bhutada would continue to work as managing director. Chamria, the filing said, would assume the role of executive vice chairman.
According to media reports, Poonawalla Finance is an existing finance company owned by the Poonawalla family, which owns and controls SII. As part of the deal, Magma Fincorp (MFL) will allot 458 million shares to Rising Sun Holdings, and 35 million shares to Sanjay Chamria and Mayank Poddar, Magma and Poonawalla Finance said in a joint statement on Wednesday.
The acquisition of a controlling stake along with huge capital infusion is expected to have a positive impact on the business operations, including for customers, employees, lenders and other stakeholders, a Business Standard report said.
Magma Fincorp is a non-deposit taking non-banking finance company (NBFC), offering a bouquet of financial products including commercial finance, agri finance, SME finance, mortgage finance and general insurance.
