Piramal Enterprises will sell its entire 8.3% stake in Shriram Finance, according to a term sheet accessed by FE. The development comes a day after TPG India Investments II sold its entire 9.92 million shares or 2.65% stake in the company. That sale was at Rs 1,401 per share, valuing the transaction at Rs 1,390 crore.
As per the term sheet, Piramal Enterprises will sell up to 31.2 million shares for Rs 4,630 crore ($ 564 million). The shares will be sold at a floor price of Rs 1,482 per share, which is at a discount of up to 5% to the current market price of Shriram Finance.
Investment banker Morgan Stanley will be the sole broker of the block deal according to reports.
In 2019, Piramal Enterprises had sold its entire 10% stake in Shriram Transport Finance for Rs 2,300 crore as part of its broader strategy to leverage opportunities for growth in the financial services business. Shriram Transport Finance and Shriram City Union Finance were merged in 2022.
Shriram Finance is a majority public owned company with a 74.49% stake, while the remaining 25.51% is owned by promoters. Among public shareholders, mutual funds have an around 6% stake while foreign investors have a 44.33% stake.
The company provides automobile loans, micro, small and medium enterprise(MSME) loans, and gold loan services, among others.