India: PE biggie KKR said to be investing $50m in NBFC Svakarma Finance

FILE PHOTO: Trading information for KKR & Co is displayed on a screen on the floor of the New York Stock Exchange (NYSE) in New York, U.S., August 23, 2018. REUTERS/Brendan McDermid/File Photo

Private equity biggie KKR is close to acquiring a majority stake in Svakarma Finance, a non-banking finance company (NBFC) headquartered in Mumbai, a TOI report stated, quoting sources.

The deal size is estimated to be $50 million, the report further stated.

The funding will help recapitalise the NBFC that was established in 2017 by former Citibank executives including Vivek Vig and Kalpana Iyer.

Svakarma Finance, an impact focused NBFC, supports micro, small and medium enterprises (MSMEs) in semi-urban and rural areas. Going forward, it aspires to cater to over 100,000 entrepreneurs across the country.

For KKR, on the other hand, the proposed investment will help expand its loan book and go beyond its focal area of corporate lending as the firm adopts measures to increase its investments in the NBFC space.

KKR India, which is one of the oldest PE investors in the country, has been experimenting with investments in the Indian credit market for long. Currently, it is also scouting for acquisitions of local non-bank financiers as the liquidity squeeze post ILFS crisis late last year has opened up opportunities for the investor fraternity overall.

Further, KKR also operates as a non-bank financier itself through its units KKR India Financial Services and KKR India Asset Finance.

In the over financial services space, KKR’s portfolio companies in India include insurance major SBI Life and billionaire Analjit Singh-led Max Financial, the holding company of Max Life Insurance.