Brookfield Asset and Another Investor to Inject Rs 457 Crore into IndoStar Capital as Promoters

28 Feb 2024 , 10:10 AM

IndoStar Capital Finance has agreed to finance Rs 457 crore by preferentially allotting warrants to promoter Brookfield Asset Management and non-promoter investment Florintree Tecserv LLP.

Brookfield will spend Rs 257 crore by subscribing to about 13.95 million warrants priced at Rs 184 apiece, while Florintree would invest Rs 200 crore by subscribing to 10.87 million warrants, according to an exchange filing.

IndoStar Capital will receive 25% of the warrant subscription amount after routine regulatory and shareholder clearances, and the remaining 75% will be obtained within the next 18 months.

Each warrant will be convertible into or exchangeable for one equity share of the firm, and it can be exercised in one or more tranches during the course of the 18-month term.

Following the fundraising, Brookfield’s current stake in the firm will remain at 56.20%.

‘The investment will enable the company to accelerate its growth journey in its core markets – vehicle finance, affordable housing finance and SME finance,’ IndoStar Capital stated in a press release.

The funding is subject to all necessary legislative and regulatory clearances, including shareholder approval.

The company will conduct an extraordinary general meeting of shareholders on March 22 to seek their approval for the proposed funding.

IndoStar Capital Finance Limited is a systemically significant non-deposit-taking non-banking finance company (‘NBFC’) registered with the Reserve Bank of India. It is a professionally managed and institutionally owned organisation that primarily provides structured term finance solutions to corporates and loans to small and medium enterprises (‘SME’) in India. 

It offers financing for commercial, passenger, and two-wheeler cars, both old and new. It also provides house loan solutions through its fully owned subsidiary, IndoStar Home loan Private Limited.

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