SMC inks Rs 215-crore JV deals with South African firm

Country’s fourth largest securities brokerage house, SMC Group, has entered into 215 crore joint venture pact with the investment arm of South African financial services giant, Sanlam Ltd.

Under the proposed agreement, the company will build two new businesses; one is wealth management company and other an asset management company in India.
The purpose of setting up the proposed company’s is to take advantage of the immense growth opportunities in the country.

Sanlam Investments, the investment subsidiary of the South African group, would take over about five per cent equity stake by way of warrants in the SMC Group for Rs 155 crore.     

While commenting on the joint venture deal, Mr. S C Aggarwal, SMC Chairman stated, “Sanlam would also invest Rs 30 crore each in the asset and wealth management businesses, while SMC would also put in the same amount in the two JV companies. The stake sale amount of Rs 155 crore and the investment of Rs 60 crore in the two JVs takes aggregate consideration of the deal to Rs 215 crore.”

"Following the JV, the Indian financial services space will see further transformation of SMC from our position as one of the largest securities brokerage houses into a well diversified company." Mr. Aggarwal added.    

The sources close to the company said that SMC and Sanlam both would pump Rs 300 million each in the asset and wealth management businesses.
SMC Group has customer base of 400,000 and is emerging at 10,000 new accounts per month.

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