Sundaram Asset Management Company announced on Friday that it had received regulatory approval for the purchase of asset management businesses of Principal Asset Management Pvt Ltd. The acquirer has obtained approvals for buying schemes managed by Principal India and 100 per cent of the share capital of Principal Asset Management Pvt Ltd.
"Leadership from both companies are pleased to report the receipt of final regulatory approvals for the purchase from the Competition Commission of India and from Securities and Exchange Board of India (SEBI)," the statement read.
Sundaram Asset Management Company is a subsidiary of Sundaram Finance Limited.
The company informed that the transaction is subjected to compliance with SEBI prescribed processes and fulfilment of mutually agreed conditions precedent to deal closure. It added that as per regulatory requirement, there would be an 'exit load free window' for investors to redeem their investments on which such an exit load would be applicable.
"We endeavour to retain and absorb Principal India's distribution franchise with minimal disruption to their commercial terms," said Sundaram Asset Management Company's managing director, Sunil Subramaniam. Another top official from the company added that the acquisition was part of their aspiration to become a sizeable player in the asset management industry. He stated that the combined business of both entities will achieve an aspiration landmark of Rs 50,000 crore.
"We will be able to leverage the combined platform to derive significant synergies. The focus for us will be on delivering a better experience to our investors and distribution partners," he said.
As per the release, post the deal closure, the schemes currently managed by Principal India and Sundaram would either be merged or renamed as Sundaram schemes in their respective categories. The investors and distributors of Principal India schemes would come under Sundaram and a wider range of schemes would be available to more than two million combined investor base.
(With inputs from PTI)