Mumbai, September 27, 2018: JM Financial Limited (“JMFL”) has entered into a Subscription and Shareholders’ Agreement with JM Financial Credit Solutions Limited (“JMFCSL”) and investors for a primary equity infusion (“Fund Raise”) of upto Rs. 875 crore. The Fund Raise is at a pre-money equity valuation of Rs.6,300 crore implying a post-money equity valuation of upto Rs.7,175 crore. The Fund Raise shall be subject to completion of customary conditions.
The Fund Raise shall increase the networth of JMFCSL by 50%(1) and further strengthen the balance sheet of JMFCSL to meet its growth requirement. The pro-forma debt / equity ratio (after including the Fund Raise) of JMFCSL would be ~2.1x as of June 30, 2018 (debt/equity on a reported basis ~3.8x). Similarly, the pro-forma debt/equity ratio for JMFL on a consolidated basis reduces to 2.3x as of June 30, 2018 (consolidated debt/equity on a reported basis ~2.7x)(2)
JMFL shall continue to retain board and management control of JMFCSL and accordingly consolidate the financial statements of JMFCSL as a subsidiary of JMFL i.e. line by line consolidation.
In February 2018, JMFL had successfully raised Rs.650 crore through Qualified Institutions Placement (“QIP”), inter alia, to support the long term capital requirements and financial needs of JMFL Group. In addition, JMFL Group has raised equity funds of ~Rs.729 crore(3) from external investors in its group companies to further strengthen their balance sheets and capitalize on business opportunities. On an aggregate basis, JMFL group has raised ~Rs.1,379 crore(3) of equity funds from investors in the calendar year 2018 till date. A brief snapshot of the deployment is as follows:
Entity within JMFL Group(3)
Equity Funds raised from QIP in JMFL
Equity funds raised from External Investors
Total equity funds raised by JMFL Group
Commenting on the fund raise Mr. Vishal Kampani, Managing Director, JM Financial Group, said, “The Fund Raise is in line with our philosophy to be conservatively leveraged and maintain strong liquidity cushions within the JMFL Group. We have continuously endeavoured to diversify our funding sources in JMFCSL through a public issue of bonds in May 2018. The group has successfully raised ~Rs.1,379 crore worth of equity funds till date in the calendar year 2018”.
About JM Financial Limited
JM Financial Limited is an integrated financial services group. The Group’s businesses include investment banking, wealth management and securities business; mortgage lending; distressed credit and asset management business (mutual fund). For more information, log on to www.jmfl.com
About JM Financial Credit Solutions Limited
JM Financial Credit Solutions Limited, a group company of JM Financial Limited, is registered with the Reserve Bank of India (RBI) as a ‘non-deposit taking systemically important non-banking financial company (NBFC-ND-SI)’. It has a short term rating of “A1+” and long term rating of “AA“ from ICRA and India Ratings. The primary focus of JM Financial Credit Solutions Limited is to make senior secured loans to Commercial Real Estate sector. For more information, log on to https://jmfinancialcreditsolutions.in
Forward - Looking statements
This press release (‘document’) containing JM Financial Group’s activities, projections and expectations for the future, may contain certain forward-looking statements based upon the information currently available with the Company or any of its subsidiaries and associate companies. The financial results in future may vary from the forward-looking statements contained in this document due to uncertainties and unforeseen events that may impact the businesses of the JM Financial Group. The Company assumes no responsibility to publicly amend, modify or revise any forward-looking statements, on the basis of any subsequent developments, information or events.
This document is for information purposes only and any action taken by any person on the basis of the information contained herein is that person’s responsibility alone and neither JM Financial Group nor any of their directors or employees will be liable in any manner for the consequences of such actions.
For further information contact:
Tel.: +91 22 6630 3475
Group Chief Financial Officer
Tel.: +91 22 6630 3460
Tel.: +91 22 6630 3585