After parting ways with Dutch asset management firm Aegon, Religare Enterprises is considering proposals for a new joint venture partner for its mutual fund business.
Sources close to the development said that at an official meeting on Friday, the asset management company’s (AMC’s) CEO Saurabh Nanavati informed employees that the company is yet to finalise a new partner from the proposals it has received so far.
Last Thursday, Religare announced it was parting ways with Aegon in the AMC business, without explaining the reasons. Sources said the complete transition of Lotus India Mutual Fund’s acquisition, which was announced earlier this month, and the Aegon split may take about four months. Once the transition is complete, Religare may finalise a fresh tie-up.
“Religare has informed Sebi about the Aegon split, and the regulator has no problems regarding this. It has asked Religare to ensure that Lotus’ acquisition is smoothly completed as soon as possible,” said a source. According to the agreement to end the partnership, Aegon will take over Religare’s stake in the AMC, and acquire the mutual fund licence of Religare Aegon AMC in order to set up its separate funds business in India. Religare will run its AMC through Lotus India Mutual Fund’s licence.
“Religare might ask for a higher premium from the new partner for picking up stake in the AMC business, post the acquisition of Lotus. This is because Religare would then have Lotus’ assets also in its portfolio,” added the source.
Though the names of players in the race for a stake in Religare’s AMC could not be ascertained, a number of global financial services firms, including Mitsubishi, Nomura, BNP Paribas and Blackstone, have in the past expressed their intent to enter the Indian mutual fund arena.