Azim Premji invests INR 7.03 Billion in Aditya Birla Capital

PremjiInvest is a private equity fund owned by Azim Premji which manages his billion personal portfolio

Wipro chairman, Azim Premji picks up stake in Aditya Birla Capital, the financial services arm of the Aditya Birla Group for INR 7.03 billion. Aditya Birla Capital sold a 2.2 pc stake to PremjiInvest, the family investment arm of the Wipro business tycoon.

The deal values the Aditya Birla Capital at around INR 320 billion.

Aditya Birla Capital has completed issuance and allotment of INR 48.4 million share for INR 145.40 per share on private placement basis to PI Opportunities Fund – 1 in accordance with the terms of the subscription agreement, Grasim Industries Ltd said in a regulatory filing on stock exchanges.

PI Opportunities I is the part of PremjiInvest, the private investment office of IT major Wipro’s Chairman Azim Premji.

Earlier on, Aditya Birla Capital entered into an agreement with sister concerns Grasim Industries Ltd and Aditya Birla Nuvo Ltd. This involved Grasim merging Aditya Birla Nuvo with itself and transferring its financial services business to Aditya Birla Capital.

Aditya Birla Capital will hold the group’s life and health insurance, asset management, private equity, corporate lending, structured finance, broking, wealth management and housing finance businesses.

The deal has also had an impact on the share price of Grasim Industries Ltd, the sister concern of Aditya Birla Capital which reportedly hit a fresh 52 week high on Tuesday.

“The shares opened at INR 1,290.10 on the National Stock Exchange(NSE) and hit an intraday high of INR 1,294.10, up 0.83 pc from its yesterday’s close of Rs 1,283.40. At 10:58 a.m., the stock was quoted at INR 1277.70, down 0.44 pc on the NSE,” reported a source.

Premji Invest is a private equity fund owned by Azim Premji, which manages over 1.76 billion Euros of Azim Premji’s personal wealth by investing in capital markets and picking minority stakes in start-ups, including indigenous e-commerce companies such as  Flipkart and mobile payment companies such as Chennai-based Financial Software and Systems.

Past ties

So far, PI has invested in Himatsingka Limited and bought 3.33 pc of the company. Himatsingka Limited is a home-grown textiles exports company which is engaged in spinning, weaving, and finishing of textiles, and manufacturing of other textiles.

Premji Invest picked a 2 pc stake in Koutons Retail, an apparel retail company, for about INR 200 million along with an INR 400 million investment in Cicada Resorts, a Bangalore-based eco-tourism operator.

It has also invested $20 million in Healthcare Global Enterprises Ltd. (HGC), one of the largest provider of cancer care in India, for a “significant minority stake,” according to chief investment officer Prakash Parthasarathy.

The Aditya Birla Capital investment has highlighted PI’s media presence even though it has “consciously avoided building a public profile.” Prakash Parthasarathy commented, “We want our work to speak for itself. With names such as Premji and Wipro backing us, we do not need to hit headlines to show our presence.”