Hinduja firm IIHL picks up stake in Indian arm of Invesco

Hinduja Group’s IndusInd International Holdings Ltd (IIHL) has acquired a 60% stake in Invesco Asset Management India Ltd (IAMI) to enter the mutual funds market. 

IAMI is the Indian arm of  global investment management firm Invesco Ltd.

IIHL is a Mauritius-based investment holding company and the promoter entity of IndusInd Bank, the fifth largest private sector bank in India. 

Invesco will retain a 40% stake in the newly formed JV, and both IIHL and Invesco will have sponsor status, a joint press release by the two companies said. 

The companies did not share financial details of the agreement.

IAMI is the fifth largest foreign asset manager and the 17th largest domestic asset manager in India with combined onshore and offshore advisory and assets under management of ₹85,393 crore as on 31 March, and a presence in 40 cities across the country.

The JV will benefit from Invesco’s portfolio of global products, processes, distribution network and 45 million customer base.

“This partnership with Invesco is aligned with our business philosophy and principles: ‘Partnership for Growth’ and ‘Act Local Think Global’ and is another step in the journey of value creation for our shareholders. Our endeavor is to reach ‘last home, last investor’ in a transparent and efficient manner and living up to investors’ expectation that ‘mutual fund sahi hai’,” IIHL chairman Ashok Hinduja said. 

Founded in 1993 by industrialist S.P. Hinduja, IIHL is an investment holding company with a portfolio comprising of banking services (IndusInd Bank, Sterling Bank & Trust Limited- Bahamas), capital market assets (Afrinex Exchange Ltd-Mauritius with a cumulative listing of $13.5bn of underlying securities) and wealth management services (Beryllus Capital-UK, Switzerland and Singapore). 

“We are very delighted to team up with Invesco to usher India’s asset management industry into a transformational innovation era. This is the most opportune time when India on the back of rising prosperity, investor confidence, and favorable demographics offers enormous prospects.” said IIHL CEO Moses Harding.

Andrew Lo, senior managing director and chief executive officer of Invesco Asia Pacific, said, “We are excited to partner with IIHL to continue to expand distribution of our high quality, global and domestic investment capabilities to serve more domestic investors in such an important market.” 

IAMI began operations in India in late 2008 with the acquisition of Lotus India Asset Management Co. and has since grown to serve over 1.6 million retail investor folios and over 39,000 empanelled distributors, with over 70% of its AUM in equity and equity-oriented assets. 

Invesco, with offices in more than 20 countries, managed $1.6 trillion in assets on behalf of clients worldwide as of 29 February. It also operates an enterprise center in Hyderabad employing more than 1,700 staff across a range of global support functions, including information technology, investment operations, finance, compliance, and human resources.

“A strong domestic partner will significantly increase the JV’s ability to expand into more Indian cities and towns, which are driving industry growth. The Indian mutual fund industry is at an inflexion point with favorable demographics and a rising middle class which will prefer transparent investment products like mutual funds and ETFs,” said Saurabh Nanavati, CEO of Invesco Asset Management India Ltd, who will continue to lead the new JV along with the existing management team.