EQT Corp. (EQT), an investment firm, announced on Friday its agreement to acquire Indostar Home Finance, an Indian affordable housing finance company, for INR 17.5 billion (approximately $210 million). Additionally, EQT plans to invest INR 5 billion to bolster the company's growth.
The transaction is pending customary regulatory approvals.
Indostar Home Finance, a rapidly expanding entity in the affordable housing finance sector, manages assets worth INR 24 billion (around $286 million). The company specializes in providing affordable mortgages to retail customers in tier 2 to tier 4 cities across India. It operates through a network of over 130 branches spanning nine states and employs more than 1,000 individuals.
The acquisition will be executed by the BPEA Mid-Market Growth Partnership (MMG) fund, which will take over Indostar Home Finance, a subsidiary of Indostar Capital Finance Ltd.
Moreover, the MMG fund will inject INR 5 billion in primary capital to support the next phase of Indostar Home Finance's growth.
EQT expressed aims to expand the company's geographic reach and advance its digital transformation initiatives.
Ashish Agrawal, Partner at EQT Private Capital Asia, commented, "Retail lending is a key investment theme for EQT within financial services in India. Building on our previous investment in the education finance sector through HDFC Credila last year, we are delighted to welcome Indostar Home Finance to our portfolio. India's affordable housing finance sector presents a significant long-term growth opportunity, supported by secular demand drivers, favorable government policies, and resilient asset quality across economic cycles."
