Federal Bank to Acquire Stake in Equirus Capital
Kochi: The Board of Directors of Federal Bank has approved acquiring a strategic minority stake of 26 per cent in Equirus Capital Pvt. Ltd. (ECPL) subject to statutory and regulatory approvals and satisfactory completion of financial and legal due diligence.
The investment rationale has been driven by the need to increase the product offerings to a spectrum of wholesale clients by presenting comprehensive financial solutions for Debt & Equity Capital Markets, Structured Finance, Capital Market products and Advisory. The partnership can also aid Federal Bank in offering a host of products including wealth management services to HNI and the NRI diaspora. The strategic tie-up would help shore up non-interest earnings for the Bank while creating additional revenue streams with identified clients.
Commenting on the investment, Ganesh Sankaran, Executive Director, Federal Bank said, “This is a landmark deal that demonstrates the Bank’s wider intent to expand the horizon of its offerings to serve its wholesale and retail customer base. This partnership will serve as a natural complement to our strong origination capabilities and deep client relationships in addition to positioning us as a Universal Financial Services Provider. With a shift in client preferences, our foray into Investment Banking will help us participate in opportunities and instruments beyond traditional banking products. With our dominant position in the NRI space and a strong customer base of over seven million, this will also help us provide superior wealth management offerings to our consumer bank clients.”
On the occasion, Ajay Garg, Managing Director, Equirus Capital said, “Investment by Federal Bank is a strong endorsement of our team’s entrepreneurial venture now on the path to becoming an institution. With this relationship, we intend to expand our product offerings in debt, and leverage on Federal Bank’s extensive network and client base to enhance each of our business lines.”
Federal Bank is a private sector bank with a network of 1,252 branches and 1,679 ATMs spread across the entire country. The Bank’s total business mix (deposits + advances) stands at Rs 1.85 lakh crore as of December 31, 2017. The Bank handles around 15 per cent of the total personal inward remittances to India.
Equirus Capital (www.equirus.com) is a closely held unlisted Investment Banking firm which has done more than 135 transactions across M&A, PE, IPOs, QIPs and Structure Finance raising more than $ 3.2 billion in the process. It is a full service Investment Bank for corporate clients and HNI customers and offers services covering Equity Capital Market, Debt Capital Market, Structured Finance, Advisory Services and Wealth Management. Its wholly owned subsidiary Equirus Securities is member of NSE and BSE. It also offers Depository services, Portfolio Management and Research apart from Equity Broking. Another subsidiary, Propeluss (www.propeluss.com), is assisting start-ups, corporates and investors to avail of investment banking services through a technology-enabled platform.