Edelweiss is in advanced stages of conversation with US-based Kora Management to sell 20 percent of Edelweiss Wealth Management for Rs 2,000 crore, valuing the business at Rs 10,000 crore, according to a report in the Economic Times.
“Edelweiss will raise Rs 2,000 crore by selling this stake and it will help in meeting debt obligations during this quarter,” confirmed a source.
The company is in the business of providing broking and asset services, advisory, distribution, ESOP and margin funding. It is planning to scale its wealth management services in 2020 with an eye on affluent business as it is looking to protect liquidity and focus on asset quality over loan book growth in its credit business. It advises assets of over Rs 1 lakh crore, and has a client base of over 4.8 lakh customers.
“Edelweiss is in touch with prominent global institutional investors, who want to invest in high quality companies and are keen to partner in the India growth story,” a source was quoted as saying by ET.
“The current operating environment and the risk averse sentiment of investors towards nonbanks, particularly wholesale-oriented entities, the ability of nonbanks to mobilise resources at adequate rates is expected to remain constrained over the near to medium term,” Icra said on Edelweiss Financial Services’ long-term NCDs.