Altico capital: New York-based Apollo Global makes preliminary offer of $150 million

By: |
Updated: October 4, 2019 5:49:40 PM

New York-based private equity firm Apollo Global Management is understood to have made a preliminary offer to pump in $150 million as equity capital into Altico Capital India, the crisis-ridden wholesale non-banking finance company (NBFC).

Altico capital, Apollo Global, NCLT, Bombay High Court, IL&FS, BSR, Companies ActThe offer is among the first potential offers made by an interested investor, sources with knowledge of the development said

New York-based private equity firm Apollo Global Management is understood to have made a preliminary offer to pump in $150 million as equity capital into Altico Capital India, the crisis-ridden wholesale non-banking finance company (NBFC). An email sent to Apollo Global Management seeking comment remained unanswered till the time of going to press.

The offer is among the first potential offers made by an interested investor, sources with knowledge of the development said.

Apollo is said to have made a presentation to the lenders with its proposal on Monday. It is not proposing any haircut to lenders, sources said.

However, lenders to Altico are understood to be in talks with other private equity firms as well to get more offers, to be able to arrive at a valuation. FE had reported on September 28 that Kotak Realty Fund is one of the contenders while another New York-based PE firm Cerberus Capital Management is also in the fray for investing in Altico.

FE had reported that Altico is in talks with three strategic investors who could invest Rs 1,500-2,000 crore in the cash-strapped NBFC by acquiring a controlling stake. These investors could include private or public sector banks, large realty funds and some NBFCs.

The company is expected to finalise an acquirer in the next one month and the deal could close in three to six months. In addition, the company may also get some short-term funds to the tune of Rs 2,000 crore by way of sale of some its existing loans and assets. Apollo is said to have been in discussions with Altico earlier, however, now it is in direct talks with the lenders.

In response to queries from FE, an Altico spokesperson said, “While we do not comment on market speculation, we reiterate that Altico and its shareholders remain deeply committed to the Indian market”.

According to sources, the discussions between PE firms and lenders are about whether to invest in the platform (Altico) or pick up particular assets. As part of the preliminary discussions, the PE firms have asked for some support from lender groups in case talks of a possible strategic stake materialises. The support sought could be to the tune of $200-$250 million in the form of commitments from lenders to fund the business going forward.

A person privy to the talks said the PE companies are of the view that such support from lenders is essential for future growth potential because as the situation stands at present, the loans portfolio is difficult to grow.

Get live Stock Prices from BSE and NSE and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.