ADIA to pick up a 10% stake in HDFC Capital for Rs 184 cr
- ByStartupStory | April 22, 2022
One of the world’s largest sovereign funds, Abu Dhabi Investment Authority (ADIA), invested as an equity partner in HDFC’s real estate alternative investment fund management company just days after parent HDFC Ltd launched the merger process.
HDFC Ltd said in a statement on Tuesday that it has signed binding agreements to sell 10% of HDFC Capital Advisors Ltd (HDFC Capitalfully )’s diluted paid-up share capital to a wholly-owned subsidiary of the Abu Dhabi Investment Authority (ADIA) for approximately Rs 184 crore ($24.1 million). ADIA is also the largest shareholder in HDFC Capital, which is now a wholly-owned subsidiary of HDFC Ltd and manages alternative investment funds.
HDFC Bank, India’s largest private sector bank, and its parent company HDFC Ltd, the world’s largest private mortgage financier, announced a $40 billion all-stock merger in early April.
The investment manager for HDFC Capital Affordable Real Estate Funds 1, 2, and 3 is HDFC Capital, which was founded in 2016. It is responsible for a $3 billion fundraising platform. Deepak Parekh, chairman of HDFC Capital, said the funds handled by the company have developed to become one of the world’s largest private financing platforms for affordable home development.
The new fund will provide long-term finance across the lifetime of affordable and middle-income housing projects, including early-stage funding, over the next 4-5 years. It will also invest in technology companies involved in the affordable housing ecosystem, such as construction technology, fintech, and clean-tech organizations. HDFC Capital has stated that it plans to support the construction of one million affordable homes in India and that it is inactive in talks with foreign investors to obtain additional cash for this purpose.
ADIA, which was founded in 1976, is an internationally diversified investment firm that invests funds on behalf of the Abu Dhabi government. ADIA and other entities, notably Blackstone’s Asian real estate fund, became investors in Indiabulls Housing Finance in December.
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