BNP Paribas to acquire Sharekhan for a deal of Rs 2,000 crore

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BNP Paribas SA, the biggest bank in France has agreed to acquire the retail brokerage firm Sharekhan from the existing set of PE owners for a sum that is undisclosed as it aims to strengthen its presence in India. Apart from the expansion plans, the firm is also aiming to develop its mobile and digital financial service further.

This deal marks the second big push of BNP into retail broking in the country. The first attempt was to buy a 3.4 percent stake in the domestic brokerage house Geojit in the year 2007 and renaming it BNP Geojit Paribas Financial Services. You must see wantmybet to obtain additional information regarding the topic and its related topics.

On Thursday, BNP Paribas announced the same as a surprise to many on the deal street. With the outmaneuvering of a PE conglomerate General Atlantic and Warburg Pincus by BNP. These companies were the forerunners in the race to buy Sharekhan, the third largest brokerage firm in India trailing behind ICICI Direct followed by HDFC Securities.

In May, it was reportedly stated that two bulge-bracket PE funds had outbid BNP and entered an exclusive negotiation with the shareholders of Sharekhan for a sale. The negotiations were dragging on beyond the period of exclusivity and BNP re-engaged with the brokerage firm Sharekhan by wrapping all the outstanding issues to get the deal.

Though the French financial powerhouse did not comment anything on the valuations, the source close to the firm state that BNP will pay somewhere between Rs 2,000 crore and Rs 2,200 crore.

BNP’s financial offerings in the country include the retail and corporate banking, wealth management and investment banking. The purchase of Sharekhan will definitely allow the company to further expand its presence into brokerage and asset management in the country.

Sharekhan will be a part of the Personal Investors division of BNP Paribas. It is a key player in the retail brokerage and digital banking services with a clientele base of 1.7 million in Europe.

The senior management of Sharekhan will stay for a couple of years as they per the agreement that is made with BNP Paribas. With a market share of 7 percent in terms of the number of accounts, the brokerage firm has been focused on the internet since its establishment in 2009.

 

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