KKR, a New York-based company, first invested in Avendus in 2015 and added further funding two years later.
CVC Eyes Avendus Stake
According to sources familiar with the situation, Mizuho Financial Group Inc.’s efforts to buy out the Mumbai-based business stagnated, so CVC Capital Partners Plc joined the race to purchase KKR & Co.’s controlling share in Avendus Capital Pvt.
According to the sources, who asked not to be named because the information is confidential, the Luxembourg-based alternative asset management is evaluating Avendus‘s business and financials, and acquisition negotiations are still in the early stages. According to them, CVC may still leave, and KKR, which holds around 63% of the business, may look at other bidders, such as Mizuho.
Significant PE Exit Signals
One of the biggest private equity exits from India’s financial services sector, the sale would indicate that investors are very interested in the nation’s rapidly expanding capital markets and wealth management sector. A new global sponsor might give Avendus additional impetus as it seeks a larger portion of asset management and advising contracts in a very competitive sector.
While CVC’s representative did not reply to requests for comment, a KKR spokesman refused to comment.
KKR’s Avendus Investment
After one of Avendus‘s minority owners requested a higher value, Bloomberg News reported earlier this month that KKR’s talks with Mizuho had stalled in recent months. The Japanese lender had been on the verge of completing an acquisition of Avendus, which would have valued the company at around $800 million.
In 2015, New York-based KKR made its first investment in Avendus, and two years later, it added further funds. Since then, Avendus has entered the wealth management, lending, and equity capital sectors in addition to investment banking.
Avendus Management Influence
Given its role in advancing business lines and development strategy, the Avendus management, under the direction of Gaurav Deepak, maintains influence over any possible transaction. According to Bloomberg News, Nomura Holdings Inc. and The Carlyle Group Inc. are among the other companies who have previously shown interest.
One of the biggest private equity companies in Europe, CVC, has been increasing its presence in Asia via transactions in the consumer, technology, and financial services industries. By investing in Avendus, Mizuho would have increased its footprint in India, a lucrative market for Japanese banks due to the growing need for finance and investment banking services.