Infrastructure Development Finance Corporation (IDFC) was looking to divest its AMC arm for some time now and they have finally found a deal. Bandhan Financial Holdings Limited, Singapore's sovereign fund GIC and ChrysCapital together have entered into a definitive agreement to acquire IDFC Asset Management Company and IDFC AMC Trustee Company, for a consideration of Rs 4,500 crore.
Even though the acquisition has been announced, regulatory approval is required and it might take several months for a complete divestiture.
Investors should expect continuity as the entire investment management team at IDFC AMC is being retained.
Here's what Anil Singhvi, the Chairman of IDFC Limited commented, "This transaction is a significant milestone in our plan of unlocking value and the consideration demonstrates the strong position of IDFC AMC in the Indian Mutual Fund space. We have achieved signing within 6 months of the Board's decision to divest, which further demonstrates IDFC Board's commitment to consummate the merger of IDFC Limited and IDFC Financial Holding Company with IDFC First Bank. The Bandhan consortium with its strong brand and resources will further strengthen distribution of products and improve overall experience for IDFC AMC's investors and distributors."
Over a period of time, IDFC MF has been successful in building a fairly formidable line of funds, particularly on the fixed-income side. With Rs 1.19 lakh crore in assets spread across 49 funds, the AMC currently ranks 9th out of the 41 fund houses actively operating in India. Of the total assets in its sack, debt assets comprise about 74 per cent.
The AMC has a bouquet of reasonably performing funds. Here is the break-up of the AMC's open-end funds as per Value Research's star rating system, as of February 28, 2022.
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