Warburg to buy stake in Future Cap for $100 m

Warburg Pincus will buy a controlling stake in India's Future Capital Holdings for nearly $100 million, helping the US investment firm to expand its presence in the Indian financial services sector.

Warburg will buy the 53.67 percent stake which group company Pantaloon Retail -- India's largest listed retailer -- holds in Future Capital, the local firms said in a statement on Monday.

The deal, at 162 rupees ($3) per share would cost Cloverdell, an affiliate of Warburg, about 5.6 billion rupees ($99 million).

The deal comes at a time when foreign corporate confidence in India is low, due to slowing domestic growth, restrictive tax policies and a perception of government paralysis to enact further reforms and liberalise the mainly inward-looking economy.

New York-based Warburg and its affiliates will make an open offer for another 26 percent stake at the same price, Future Capital said in a statement.

AFP