Business Current Affairs

Centrum Group to acquire L&T’s Finance Supply Chain business

According to reports, The Centrum Group, controlled by Jaspal Bindra, a former Standard Chartered banker, has announced that it will be acquiring  L&T Finance’s supply chain lending business that has an outstanding loan book of Rs 800 crore.

According to officials at Larsen & Toubro, this divestment move is part of a broader effort to trim its wholesale lending business and to focus more on housing and retail segments.

L&T, a supply chain finance business offers working capital supports and loans to dealers and manufacturers of large industrial equipment.

After the buyout, it is expected that Centrum will on board the executive team of nearly 60 people, and in turn, scale up the business significantly.

According to Multiple sources closely following the matter, they told Economictimes, a local news publication that a definitive agreement is expected to be signed mostly by next week.

According to a source who preferred being anonymous, “The deal is sealed. It is a transaction that will be strategically beneficial to both L&T Finance as well as Centrum. We believe a formal announcement will be made by the upcoming week.”

However, neither L&T Finance nor Centrum gave a comment regarding this matter.

Notably back in April, In an interview with ET Now (economictimes.indiatimes), Dinanath Dubhashi, MD & CEO of L&T Finance Holdings had said, “A couple of years ago, when we began our turnaround plan, wholesale was almost 62 per cent of the balance sheet and that was excessive for almost any business.”

He further added, “It is obvious, that this had to be reduced,  and share of housing and rural  had to be increased.”

Centrum, a company which just some time ago sold its foreign exchange business to NASDAQ-listed Ebix Corp, has publicly announced that it aims to expand its lending business and for that purpose, it has been aggressively expanding both wholesale and retail loans.

Centrum has a pre-existing SME loan book of Rs 750 crore and with this acquisition, the size of the book will get doubled.

Back in November 2017, FirstRand Bank’s Indian microfinance portfolio got acquired by Centrum along with its 300 employees and 25 offices all over India.

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Noam Levenson

Noam Is the CEO And Co-Founder At EdenBlock.com. He Is Also A Well Writer, Researcher, Crypto Guide And Investor In Distributed Ledger Technology. Noam Contributes More News On Latest Bitcoin Comparisons, Publishes Whole One And All Digital Currency Trading. And He Loves To Serve The Community.

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