Thursday, January 4, 2007

Foreign investors pick 20% stake in Edelweiss Capital

Mumbai-based investment bank Edelweiss Capital has divested 20% stake to a number of financial investors including the Government of Singapore Investment Corporation (GIC) and the New York-based hedge fund Galleon Partners for around $90 mn.

Edelweiss will announce the deal soon after the Foreign Investment Promotion Board (FIPB) clears the investments.

With this transaction, Edelweiss is valued at around $400-450 million. The investment bank is also considering an initial public offer (IPO) by 2008 to give an exit option to its various investor groups. Prior to deal, employees and promoters of Edelweiss were holding around 74% equity stake, with Greater Pacific Capital (GPC), a London-based strategic investment firm and Americorp Capital jointly holding the remaining 24% stake.

Edelweiss was established in 1996 and now boasts of a team of around 600 people, with services ranging from brokerage to investment banking, asset management and insurance advisory. Edelweiss has been growing at 100% growth rate over the last 3 years. Revenues grew to Rs. 147 crores in 2005-06, from Rs. 73 crores in the previous year, while PAT grew to Rs. 42 crores from Rs. 24 crores.

Read The Economic Times article.

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