Premjiinvest buys 45% in Shubham Housing for ₹225 cr

MUMBAI: Premjiinvest, the family investment arm of Wipro chairman and billionaire Azim Premji, has acquired a significant minority stake in Shubham Housing Development Finance Co Pvt Ltd, two people aware of the development said.

Premjiinvest invested about $35 million (₹225 crore) for about a 45% stake in the affordable housing finance company from promoters as well as existing investors, one of the two people said on condition of anonymity. This makes Premjiinvest the single-largest shareholder in Shubham. The transaction values Shubham at ₹500 crore.

Shubham Housing provides housing credit to people employed in the informal sector. According to its website, it is present in 12 states, with a loan portfolio of ₹1,200 crore. “The deal has been signed last week and the announcement is expected soon,” said the second person, also on condition of anonymity.

Founded in 2010, Shubham Housing raised ₹122 crore in a round led by Motilal Oswal Private Equity Advisors and existing investors including Helion Advisors, Elevar Equity, Accion Frontier and Saama Capital in 2014. The company had previously raised $8 million in 2012. With the Premjiinvest deal, Saama Capital and Accion Frontier will exit Shubham while Motilal Oswal, while Helion and Elevar Equity will remain, the second person said.

When contacted, Rajesh Ramaiah, director and CFO at Premjiinvest; Suresh Shanmugham, managing partner and co-founder of Saama Capital; and Ganesh Rengaswamy, partner at Quona Capital, which manages Accion’s Frontier Inclusion Fund declined to comment, while an email sent to Sanjay Chaturvedi, chief executive officer of Shubham Housing went unanswered.

Shubham is looking to raise around $100 million from private equity (PE) funds as the company looks to increase its loan portfolio and expand its network nationally and hired Avendus Capital, Mint reported in August last year.

According to data from the Registrar of Companies (ROC), Shubham more than doubled revenue to ₹51.9 crore in 2014-15 from ₹24.8 crore a year earlier.