Kolkata-based Peerless Group on Thursday announced that it has signed an agreement with Essel Finance Management of Subhash Chandra’s Essel Group to sell its mutual fund business, which currently has an asset base of about Rs. 950 crore. The size of the deal was not disclosed. Essel Finance said this acquisition of the mutual fund business was a part of its strategy to become a financial services conglomerate.
In statement, The Peerless General Finance and Investment Company Limited (PGFI) said it will sell its entire shareholding in the Peerless Fund Management Company Limited (PFMCL) and the Peerless Trust Management Company Limited (PTMCL) to Essel Finance Management LLP (EFM).
Financial services major PGFI is the sponsor, PTMCL is the trustee, and PFMCL is the investment manager, respectively, of Peerless Mutual Fund. The transaction will be completed once all regulatory approvals have been obtained, it added.
Talking to FE, Rajiv Shastri, managing director of Peerless Funds Management, said, “As per the agreement, our entire team of the mutual fund business will be the part of Essel Group, which is a big business group in the country. We are very excited about it.”
According to Shastri, Peerless Mutual Fund is currently present in 19 locations across the country and has an asset base of about Rs. 950 crore. Its customer base stands at 88,000.
Speaking on the occasion, S K Roy, managing director of The Peerless General Finance and Investment, said, “We are happy to have reached this agreement with the highly regarded Essel Group, which intends to build on the efforts taken by the Peerless Group over the last few years. We are confident that the interests of our unitholders will remain foremost in their approach to this service, as it was in ours.”
Essel Finance is the umbrella brand for the financial businesses of the $10 billion Essel Group. It offers a range of financial services and products such as SME Business Loans through its Non-Banking Financial Company (NBFC), Housing Finance, Forex, Private Equity, Investment Banking & Distribution.
Amitabh Chaturvedi, managing director of Essel Finance Management, said, “The acquisition is part of our strategy to become a financial services conglomerate. The addition of the mutual fund business will fortify our position and take us closer to our goals.
“We are very pleased with Peerless’ team, products and its performance and are confident that we will be able to create a large asset management business. We look forward to a smooth & speedy transition, subject to regulatory approvals,” Chaturvedi added.
Peerless Mutual Fund, the first mutual fund in the Eastern region, at present has one liquid scheme, four fixed income schemes, one hybrid scheme and three equity schemes, including an equity linked savings scheme.