MUMBAI: Nasdaq-listed Ebix Inc is set to acquire India's leading airport foreign exchange provider CentrumDirect in a deal estimated at about $200 million, or Rs 1300 crore, people directly aware of the matter said.
Atlanta-headquartered software and e-commerce company Ebix has made an offer to buy 100% stake in the foreign exchange business unit of Centrum Group, a homegrown financial services firm promoted by Chandir Gidwani and Jaspal Bindra, which is awaiting formalities.
The divestment move is part of Centrum's plans to exit non-core businesses. Former Standard Chartered honcho Bindra, who emerged as Centrum's co-promoter, has pursued a business streamlining exercise at Centrum. The sale of forex unit would provide Centrum with adequate capital to grow its NBFC operations focused on housing finance, SME, and microfinance lending.
CentrumDirect services more than one million forex transactions - currencies, overseas remittances, prepaid travel cards and traveler's cheques - annually through a network across 46 Indian cities, including 23 airports. The sale to Ebix comes at a significant premium to last year's share sale to a consortium of PE Investors - Jacob Ballas, New York Life and Evolvence, sources added.
Centrum's non-core divestments could see it tapping inorganic growth opportunities. It had acquired the microfinance portfolio of FirstRand Bank India six months back. Centrum's core businesses are in investment banking, wealth management, institutional broking and Insurance distribution.
India-born Robin Raina-spearheaded Ebix is a leading supplier of on-demand software and e-commerce services to the insurance, financial and healthcare industries. Ebix through its recent acquisitions of Indian payments companies - ItzCash, Paul Merchant, YouFirst, Spice Money and Transcorp - has built a strong presence in the inward remittance and domestic money transfers businesses in India.
The acquisition of CentrumDirect would help Ebix to shape up its outbound foreign exchange and remittances businesses in Asia's third-largest economy. It also recently snapped up an online travel portal, Via-.com. When contacted, Centrum declined to comment on speculation, while Ebix could not be reached for immediate comments over the weekend.
Source: timesofindia.indiatimes.com