To boost its presence in the growing domestic market,HSBC is planning to acquire 73.21 percent of Indian brokerage IL&FS Investsment in an all-cash deal for $261 million. Foreign banks and companies are also getting attract by the country’s attractive fees and a booming economy and they are looking forward to open
shop in India to tap into rising savings of a growing middle class. According to Sandy Flockhart, chief executive officer of HSBC Asia Pacific, said in a statement that this investment is of strategic importance to HSBC as it gives us a foothold in one of the largest retail broking markets in the world. HSBS said it will also pay Mumbai-based IL&FS an additional $19.4 million as part of a three-year non-compete agreement and will soon make an open offer to acquire up to 20 percent of the remaining shares.

The emailed statement said that, HSBC’s open offer is subject to regulatory and other approval. Mumbai-based IL&FS Investsment has 2,000 employees and provides various financial services such as equity and commodity broking, investment banking and fund distribution to 138,000 customers in 133 cities. HSBC, via its subsidiaries, will acquire 43.85 percent from E*Trade Mauritius Limited, a unit of U.S. online brokerage firm E*Trade Financial Corp and a 29.36 percent from Infrastructure Leasing and Financial Services (IL&FS) for $241.6 million or 200 rupees per share, it said in a statement.

Categories: Business
Tags: Banks, HSBC, IL&FS, investment, market, MIT, Planning, Shares