General Atlantic, Varde deal to buy stake in India’s PNB Housing falls apart

Photo: Reuters

Global private equity firms General Atlantic and Varde Partners have mutually terminated an agreement to buy a 13.1 per cent stake in mortgage lender PNB Housing Finance Ltd for Rs 1,851.6 crore ($268 million) from Punjab National Bank (PNB).

“Since all conditions precedent to completion of the transaction are yet to be fulfilled and accordingly the completion has not occurred as on date (i.e., 15 May 2019 being the long stop date under the SPA), the SPA stands terminated with immediate effect,” PNB said in a stock filing on Thursday.

Both investors were to pump in Rs 925 crore each, at Rs 850 per share, to acquire 1.08 crore shares each from PNB, the lender had said in a March stock filing. Last week, the Competition Commission of India (CCI) had also approved the stake acquisition by General Atlantic in PNB Housing.

Following the deal termination, PNB will continue to be the sole promoter of the company and stay strategically invested in the company, the filings added.

The bank said that it strongly believes in the growth story of the company and will continue to support the business and its management in pursuing its growth plans. Further, PNB will continue to provide branding support so long as it is the promoter, it said.

As of March 2019, PNB held a 32.79 per cent stake in PNB Housing Finance while another major PE player, The Carlyle Group, held 32.36 per cent stake in the unit.