Micro finance institution (MFI) Spandana Sphoorty Financial Ltd has raised $270 million through a mix of equity and debt funding, according to a statement.
PE firm Kedaara Capital led consortium including Ontario Teachers’ Pension Plan has invested over $100 million for a stake while $170 million is raised from IndusInd Bank, Yes Bank and ICICI Bank in the form of debt.
According to a public notice last month, the microfinance lender was in talks with Kedaara Capital to sell more than 26 per cent in the company.
It will use the money to repay and restructure Spandana’s existing debt with 37 different lenders and exit the Indian corporate debt restructuring scheme.
Spandana, which had been referred to corporate debt restructuring (CDR) by its lenders in 2011 after the Andhra Pradesh microfinance crisis, is raising funds to clear its existing debts with 37 financial institutions which had previously gone bad.
The MFI operates through 540 branches in 13 states across the country and has over 2 million borrowers with a portfolio outstanding of Rs 1,325 crore.
In the microfinance space, Last week, IFC (International Finance Corporation), a member of the World Bank Group, committed to provide up to $20 million to RGVN (North East) Microfinance Ltd in the form of a senior debt investment.
Guwahati-headquartered RGVN is an RBI-registered NBFC which facilitates loans to health, education and livelihood sectors in the North Eastern region.
Shearman & Sterling advised Ontario Teachers’ Pension Plan Board (OTPP), alongside Kedaara Capital and Soros Fund Management LLC on its investment into Spandana Sphoorty.