A clutch of high-profile investors, led by Lehman Brothers and Holcim Group chairman Thomas Schmidheiny, are together buying a 5% stake in Edelweiss Capital—a leading financial services company in the country—in a pre-IPO placement of equity.
Edelweiss Capital is close to signing deals worth $50 million with the global investors, which value the Mumbai-based broking and investment banking group at about $1 billion, according to sources. The valuation is almost on a par with those of top investment bankers such as DSP Merrill Lynch and JM Financial, and is believed to be much higher than that of large domestic brokerage houses such as Motilal Oswal Securities and Sharekhan.
Mr Schmidheiny is buying a stake through his family investment firm. The three other investors include existing equity partner and New York-based hedge fund Galleon Partners, Middle East-based asset management company (AMC) Shuaa Capital, and Sequoia Capital. The Edelweiss board is meeting next week to finalise the deals, said sources.
The Indian broking and investment banking space has been witnessing an accelerated flow of foreign investments amid extremely bullish market conditions in the past 3-4 years. This has resulted in significant improvement in their valuations, prompting an increasing number of players to take the private equity route and/or go for an IPO.
(Source: Economic Times)
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