India's Magma Fincorp, said on Thursday it has acquired home loan portfolios from GE Capital India, a unit of General Electric Co.
The Indian non-banking finance company signed definitive agreements to acquire GE Money Housing Finance and the entire home equity loan portfolios of GE Money Financial Services, Magma said in a filing to the Bombay Stock Exchange.
GE Money Housing Finance and GE Money Financial Services are subsidiaries of GE Capital India. The filing did not give the financial terms of the deals.
Kohlberg Kravis Roberts and Co. and International Finance Corp, an arm of the World Bank, hold significant minority stakes in Magma.
GE Money Housing Finance has loan assets of 6.6 billion Indian rupees ($122.08 million) while GE Money Financial Services has about 9.4 billion Indian rupees ($173.86 million), it said.
Shares of Magma Fincorp were trading 2.29 percent higher at 67 rupees on Thursday, outperforming the benchmark index, which was down 0.3 percent.
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GE Capital India to sell mortgage loan biz to Magma FinCorp
New Delhi: (PTI) Financial Services firm GE Capital India today agreed to sell its mortgage loan business arms to Magma FinCorp for undisclosed amount.
The shareholders of GE Money Housing Finance have agreed to sell their entire holding in the company and the board of directors of GE Money Financial Services Private Ltd have also agreed to sell their entire home loan and home equity portfolio to Magma FinCorp and its affiliates in an all cash deal, GE Capital India said in a statement.
This marks GE Capital's exit from the mortgage loan business in India.
GE Money Housing Finance with a networth of Rs 193 crore has loan assets of Rs 660 crore at the end of March 2012.
At the same time, entire home equity loans portfolio of GE Money Financial Services, another affiliate of GE Capital, was about Rs 940 crore at the end of May 31, 2012.
"This decision is in line with the strategic realignment of our businesses globally. It is also in line with a decision
we had taken three years ago to exit from our mortgage loan business in India," GE Capital India CEO Anish Shah said.
"We will continue to focus on growing our commercial finance business and credit card joint venture in India, leveraging our global expertise in certain specific product and process domains," he said.
Until the completion of the transactions, GE Money mortgage customers in India will continue to be serviced by the GE Money team.
The transactions are subject to standard conditions precedents including regulatory approvals, as applicable.