Indiabulls Housing Finance's founder, Sameer Gehlaut, has dramatically reduced his stake to just 2%, down from 21% in December 2021. This move aligns with the company's transformation towards institutionalization, with foreign institutional investors set to hold nearly 60% by the fiscal year's end. In addition to the stake reduction, Indiabulls plans to adopt a new name later this year. Gehlaut's complete exit is planned for September, paving the way for majority ownership by global funds such as Blackstone, ADIA, Vanguard, PIMCO, and BlackRock.
Indiabulls Housing Finance is undergoing a significant transformation as its founder, Sameer Gehlaut, continues to slash his stake in the non-banking finance company (NBFC) he started. Currently holding just 2% in the company, Gehlaut's stake has seen a rapid decline from 21% in December 2021. He is anticipated to exit the company entirely by the end of September, following his resignation as promoter in February 2023.
This decision is aligned with Indiabulls' plans to fully disengage from its former promoters, marking a strategic move towards institutionalization. Furthermore, the company will adopt a new name later this year, signifying a complete break from the past.
The reduction in Gehlaut's stake is not an isolated event but part of a broader shift in ownership. Several large global funds, including existing foreign institutional investors (FIIs), are poised to increase their stake in the coming weeks. By the close of the fiscal year, these international funds are expected to own nearly 60% of the renamed company.
The trend began a few years ago when Gehlaut's stake, once as high as 40%, was diluted to 21.69% following a ?6,500-crore equity raise in 2016. The process accelerated in the past 18 months, with Gehlaut divesting over 18% of his stake. Major financial players like Blackstone Inc, Nomura, Morgan Stanley, and Abu Dhabi Investment Authority (ADIA) were involved in transactions, including a ?1,443-crore block deal in December 2021.
Investment giants such as Blackstone, ADIA, Vanguard, PIMCO, BlackRock, and TreeTop Asset Management are among the foreign institutions set to increase their stake. Currently, foreign institutional investors hold 18.52% in the company.
Gehlaut's departure from the company he founded is more than a symbolic change; it serves as a precondition for these international funds to assume majority ownership. As one person familiar with the company's strategies confirmed, the transition to foreign majority ownership is nearly complete, and in the coming months, these funds will become the dominant forces within the company.
In conclusion, Indiabulls Housing Finance's move towards institutionalization, marked by Gehlaut's rapid reduction in stake and planned complete exit, signifies a strategic repositioning of the company. The upcoming ownership shift to global funds and a renaming of the company underscores a renewed focus on growth and international collaboration. This transformation reflects a broader trend in India's financial sector, as companies seek to adapt and evolve in an increasingly globalized and competitive marketplace.
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