The acquisition of an additional 4.48% equity stake in Belstar Microfinance by Muthoot Finance prompts inquiries into its classification as a related party transaction and any potential interests from the promoter, promoter group, or affiliated companies. Notably, Belstar Microfinance operates as a subsidiary of Muthoot Finance, with several directors serving on both entities’ boards.
Belonging to the microfinance industry, the acquisition aligns with Muthoot Finance’s strategic objectives, allowing it to bolster its stake in Belstar Microfinance from 59.02% to 63.50%. Not requiring governmental or regulatory approvals, the acquisition has been successfully completed, facilitated by cash consideration of Rs. 300 Crores for the acquisition of 60,00,000 equity shares. This transaction represents a notable 4.48% increase in Muthoot Finance’s shareholding in Belstar Microfinance Limited.
Belstar Microfinance Limited, a subsidiary of Muthoot Finance Limited with its headquarters in Tamil Nadu, specializes in providing microfinance services. More information about the company can be found on its website. Over the past three fiscal years, Belstar Microfinance has demonstrated consistent growth in turnover. In the fiscal year 2022-23, turnover reached Rs. 10,312.61 million, showing a notable increase from Rs. 7,272.29 million in 2021-22 and Rs. 5,516.22 million in 2020-21. This upward trajectory reflects the company’s strong performance and significant presence in the microfinance sector.