Sumitomo Group to acquire Fullerton India Credit for $2.5 bn

Diversified Japanese conglomerate Sumitomo Mitsui Financial Group on Tuesday entered into a pact with Fullerton Financial Services Holdings to take over the latter's non-banking arm Fullerton India Credit Company in a reported USD 2.5 billion deal. Fullerton Financial Services is a fully-owned subsidiary of the Singaporean investment giant Temasek Holdings.

The Japanese acquirer did not disclose the deal value in the public statement, but market sources told PTI that Sumitomo will pay around USD 2 billion for the 74.9 per cent stake it will buy in the first leg of the two-legged deal, and another USD 500 million-plus for the remaining stake to take the ownership 100 per cent.

At the current exchange rate, the deal value will be about Rs 18,550 crore.

The two-legged deal involves Sumitomo buying 74.9 per cent in the city-based Fullerton India Credit Company and subject to regulatory approvals, later acquiring the remaining stake to fully own it later, the Sumitomo and Fullerton said in a joint statement.

Sumitomo said the deal will help it participate in India's long-term growth story on one hand and help it strengthen its digital reach across Asia.

“Sumitomo Mitsui Financial Group Inc today entered into an agreement with Fullerton Financial Holdings Pte Ltd to acquire 74.9 per cent stake in Fullerton India Credit Company from the latter, subject to regulatory approvals. Sumitomo will eventually acquire 100 per cent of Fullerton Credit,” the Japanese giant and the Singaporean owners said in a joint public statement.