Avanse Acquires Rs. 800 Cr. in Primary Capital From Kedaara
- ByStartupStory | January 19, 2023
Avanse Financial Services Ltd, a non-banking lender with a focus on education loans, announced on Thursday that it has raised primary capital from domestic private equity company Kedaara Capital in the amount of Rs 800 crore (about $49.2 million) to support its expansion aspirations.
The primary shareholder in Avanse will still be the current investor Warburg Pincus. The first information about private equity investors, notably Kedaara Capital, negotiating with Warburg Pincus to acquire a portion of its share in Avanse came from Mint in November of last year.
“Avanse is at an exciting phase of growth. As the world recovered post the pandemic, we witnessed a significant resurgence of students seeking higher education at international locations,” said Amit Gainda, managing director and chief executive at Avanse Financial Services.
“The growth capital will enable us to strengthen our brand proposition, integrate digital solutions and innovate to build more depth into our product range as we work towards delivering greater stakeholder value,” he added.
Students, professionals, and institutions in India can apply for education-focused loans from Avanse Financial. The 2013-founded business claims to have served more than 3,000 institutions and close to 3 lakh academic applicants globally. In addition, it has given more than 1,000 educational institutions growth and working money.
The non-banking lender managed assets worth Rs 8,000 crore as of December 2022. During the first nine months of the financial year 2023, the company disbursed loans worth Rs 4,850 crore, which is around 2.5 times more than it did during the same period last year.
“We look forward to using our operational expertise and experience in the financial services space to help them realise their long-term vision,” said Sunish Sharma, managing partner and Co-chief executive at Kedaara Capital.
In its three funds, Mumbai-based Kedaara Capital has made financial services investments in businesses like AU Small Finance, Veritas Finance, and Aavas Financiers Limited (formerly Au Housing Finance). Its portfolio also includes businesses like the beauty e-commerce site Purplle and the chain of hospitals ASG Eye hospitals.
“The fresh primary infusion will significantly improve the company’s capitalisation, providing a strong base for future growth,” said Kartikeya Kaji, Managing Director, Kedaara Capital.
The transaction’s exclusive financial advisor was Avendus Capital.
Following a capital infusion from Warburg and IFC, the private investment arm of the World Bank, in September 2022, when it had raised Rs 390 crore, the most recent investment from Kedaara occurs a few months later. When Warburg acquired an 80% share in Avanse from Wadhawan Global Capital Ltd and its subsidiary Dewan Housing Finance Corporation Ltd (DHFL) in March 2019, it became the company’s first investor.
The active portfolio of more than 260 companies managed by Warburg, which has its headquarters in New York, totals more than $85 billion in assets. The company has made investments in a number of startups in India, including boAt, Ola, and The Good Glam Group.
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