Edelweiss Capital acquires Lalbhai Group's Anagram Capital for Rs164 crore
27 January 2010
Brokerage and financial services firm Edelweiss Capital plans to acquire Anagram Capital for Rs164 crore in an all-cash deal to expand its footprint across the country.
Ahmedabad-based Anagram Capital, part of the Rs2,000 crore Arvind Lalbhai group, with net profit of Rs3.5 crore in FY 2008-09, has a country-wide network of more than 137 branches, over 1300 sub brokers, 180,000 clients and a average daily equity trading volume of Rs800 crore.
Sanjay Lalbhai, nephew of Arvind Lalbhai and chairman and managing director of Arvind Mills Ltd, had been looking to hive off Anagram for quite some time for around Rs225 crore, but potential buyers have made offers around Rs120 crores-150 crore.
In a statement to the National Stock Exchange, the Mumbai-based Edelweiss said that it along with its subsidiary Edelweiss Investments & Finance has entered into an agreement with Anagram Capital to acquire it for Rs164 crore.
Edelweiss, a provider of investment banking institutional equities, private client broking, asset management, investment advisory services and wealth management services through 43 offices in 19 Indian cities, plans to operate Anagram as a wholly owned subsidiary.
"This acquisition is in sync with Edelweiss' plan to expand the retail broking business. What makes this transaction exciting is the minimal overlap between the broking operations of both the companies," said Edelweiss group chairman Rashesh Shah.
The proposed acquisition, which requires regulatory approval, will help Edelweiss to expand the retail broking business and distribution businesses.