Rana Talwar’s Sabre Capital, backed by private equity giant Temasek, is in talks with Cholamandalam DBS Finance (CDFL) to take over the latter’s mutual fund company — DBS Cholamandalam Asset Management. The deal, advised by Kotak Mahindra, is likely to be around Rs 400 crore, said sources. A few other strategic investors are also believed to be in the fray.
The fund’s assets under management (AUM) had dropped from over Rs 5,000 crore in July 2007 to around Rs 3,829 crore in September. Sources said both partners — DBS and the Murugappa group — were not happy with their MF business, which has slipped in rankings over the past few months.
Sabre, along with Temasek, currently owns Lotus India Asset Management. Temasek-owned Alexandra Fund holds 42.8% in Lotus while Sabre holds 32.2%. The balance is held by employees and domestic shareholders.
Sources said if Sabre and Temasek succeed in the acquisition, they will merge the AMC with Lotus. As per the figures available for September 2007, Lotus has built up an AUM of Rs 6,385 crore. DBS Chola, meanwhile, has an AUM of only Rs 3,829 crore.
Read more in The Economic Times article.
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