Shriram Finance, a Chennai-based retail non-banking finance company (NBFC), is revisiting plans to sell a controlling stake in its subsidiary, Shriram Housing Finance. The parent company, primarily focused on commercial vehicle financing, currently owns 84.82% of Shriram Housing Finance, while the remaining 14.94% stake is held by Valiant Capital Management, a US-based private equity firm.

Earlier attempts were made this year to sell a stake, and the deal has been relaunched with the involvement of various advisors. Preliminary discussions have started with potential suitors, including both corporates and private equity funds. The plan is to divest a majority stake in Shriram Housing Finance.

The report mentions that all options are being considered, and depending on valuations, even a minority stake sale could be considered. Shriram Housing Finance is in need of capital for growth, and it is not considered a core segment for the parent company.

Investment banks Avendus Capital, JM Financial, and Barclays have reportedly been given the joint sell-side mandate for the proposed transaction. Valiant Capital Management, having invested in Shriram Housing Finance for several years, has the option to exit in the case of a 100% sale scenario.

Housing finance stocks, including Shriram Finance, have been performing well in recent times. The article provides key statistics about Shriram Housing Finance, including its assets under management, total income, profit after tax, branch network, and customer base.

The report concludes with details about Shriram Finance Limited, highlighting its formation through the amalgamation of Shriram City Union Finance Limited, Shriram Capital Limited, and Shriram Transport Finance Company Limited. Shriram Housing Finance, a subsidiary of Shriram City Union Finance, became a subsidiary of Shriram Finance post the amalgamation. The subsidiary focuses on providing home loans and loans against property, with a particular emphasis on self-employed borrowers and lower-income segments in Tier II and Tier III cities.

The article was last updated on December 14, 2023, and the status of the transaction may evolve over time.