Societe Generale grows India presence through acquisition

Societe Generale announces acquisition of a 75% stake of Indian financing and leasing company.
Societe Generale announced on July 5 that it had, in partnership with Indian business family, the Burmans, acquired a 75% stake in Apeejay Finance, an Indian financing and leasing company. The promoters of Apeejay Finance, the Apeejay Surendra group continue to hold 25% of the unlisted finance company.

Jean-Francois Gauthier, head of specialised financial services comments: ôThe acquisition of Apeejay Finance allows us to set foot on the fast growing Indian consumer credit market. Building on the strengths of Apeejay FinanceÆs teams and on the local knowledge of the Burman and Paul families, our partners, the financial and industrial know-how of Societe Generale group should lead the newly acquired business to becoming one of the leaders of consumer credit in India.ö

Apeejay Finance was incorporated in 1993 and finances a range of vehicles and consumer durables. It has a customer base of 40,000 across India and is present in eighteen locations. The retail auto finance market in India is witnessing high rate of growth. Its size is currently estimated at Rs1,213 billion ($26.3 billion) of which the non-banks segment is about one third. Apeejay Finance manages about Ç100 million in outstanding loans.

Other businesses in the Apeejay group include India's Park chain of hotels, tea, shipping, real estate and retail. The group is almost a century old and is largely privately owned with only one listed company. It is one of the largest closely held business houses in the country.

The Burmans have interests in fast moving consumer goods (FMCG), insurance and financial services. The flagship and largest company of the group is Dabur, the fourth largest FMCG company in India.

The transaction is in line with the development strategy of the specialised financial services division of Societe Generale group in Asia. In 2005 Societe Generale launched ALD Automotive, the firmÆs operational vehicle leasing and fleet management company, in India. ALD Automotive currently has four branches in India. The acquisition of Apeejay Finance is seen as complementary to the existing ALD operations.

The size of the deal hasn't been disclosed but the Indian media has rumoured the acquisition to be worth Rs100 crores ($21.7 million).

¬ Haymarket Media Limited. All rights reserved.

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