India: UK’s CDC sells stake in Ujjivan Financial Services for $15m

Visual taken from company's website on June 1, 2017

UK firm CDC Group Plc has part-exited its two-year-old investment in Bangalore-based Ujjivan Financial Services Ltd through bulk deal last month.

According to data available on the Bombay Stock Exchange, the UK government development finance arm CDC sold 27.5 million shares or 2.3 per cent stake at Rs 360 per share, earning Rs 99 crore ($15.4 million). In the process, Cinnamon Capital Ltd bought the stake from CDC.

Ujjivan currently has 457 branches in 24 states and is planning to open 66 new ones in financial year 2017-18. In February, the company announced its official transformation into Ujjivan Small Finance Bank Ltd.

CDC had invested in the company in 2015 as a part of Ujjivan’s Rs 600 crore round in which other investors like CX Partners, NewQuest Asia Investments, Bajaj Holdings, IFC and Elevar Equity also participated.

Post divestment, it holds 6.86 per cent stake in the small finance bank.

Ujjivan was founded in 2005 by Samit Ghosh. The company had a total income of Rs 334 crore and a net profit of Rs 19.3 crore in FY 16-17.

Ujjivan scrip last traded at Rs 305.9 each, down 0.50 per cent on BSE in a weak Mumbai market on Thursday.

In the microfinance sector, most recently, Guwahati-headquartered RGVN Microfinance (North East) Ltd received the final licence from Reserve Bank of India (RBI) to set up a small finance bank.

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