Sequoia May Pick Up 9.4% in CARE

Mar 2010
New Dehli, India, March, 09 2010 - Private equity firm Sequoia Capital is looking to pick up 9.4% stake in rating agency Credit Analysis and Research Ltd (CARE) for Rs 73.5 crore, people close to the development said.

CARE, a non-banking financial institution (NBFC) and rating firm, is controlled by IDBI Bank, SBI and Canara Bank.

Currently, it has no foreign shareholding. IDBI bank, with more than 26% stake, is the largest shareholder in the rating firm, which was set up in 1993.

Canara Bank holds 23.67% in the company, while SBI has 9.97% stake. Other shareholders in CARE are Federal Bank, IL&FS and ING Vysya Bank.

The US-based venture capital firm proposes to pick up stake in CARE through the acquisition of shares from three Indian shareholders at a face value of Rs 10 a share.

The deal values Mumbai-based CARE, the second largest rating firm in India, in excess of Rs 781 crore. CARE could not be reached for comments on the proposed deal. The net worth of CARE is approximately Rs 133 crore and the company has been capitalised to the extent of Rs 8 crore by its shareholders.

Some of Sequoia Capital’s recent investments in India include microfinance corporations like Equitas and Ujjivan, travel agency Via, eyecare clinic chain Vasan Health Care and local search firm Just Dial. In February, it picked up 25% stake in Bangalore-based kitchen appliances company Stovekraft for Rs 50 crore.


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