Prudent Corporate advisory Services Ltd ("Prudent"), a leading independent distributor of mutual fund and other wealth products, today announced that it has completed a process of offering minority investment in to TA Associates, a leading global growth private equity firm. Financial terms of the transaction were not disclosed.
Founded in 2001, Prudent provides personal and corporate investment planning services through the distribution of mutual funds, bonds, broking and insurance products. The company operates through its network of over 10,000 Independent Financial Advisors ("IFAs") and has in excess of 18,000 Cr of assets under management ("AUM").
Prudent provides its IFA partners with training and development services, technology platforms to grow and manage their client-base, back-office services, and sales and marketing support. The company is headquartered in Ahmedabad, Gujarat and operates a total of 70 branches across 19 states in India.
"With its IFA-centric business model, multiple service offerings and robust technology platforms, we believe Prudent represents a unique and exciting investment opportunity," said Aditya Sharma, Senior Vice President, TA Associates Advisory Private Limited, who will join the Prudent Board of Directors. "We look forward to collaborating with the entire Prudent team to help take the company to the next level."
"TA's investment is a critical milestone for Prudent as we embark on our next phase of growth and seek to deepen our presence across multiple states and untapped markets," said Sanjay Shah, Founder and Managing Director of Prudent Corporate Advisory Services. "As an active and respected investor within the financial services vertical, TA has developed a quality reputation of forming trust-based relationships with founders and management teams that lend themselves to positive results. It is evident that TA shares our vision to incorporate additional value creation for our customers and IFA partners, and we are thrilled to have them as part of the Prudent family."
The Indian asset management industry's AUM has grown at a compounded annual growth rate (CAGR) of 18 percent over the last 10 years. As of the end of March 2018, the industry had a total AUM of approximately $338 billion. Furthermore, according to AMFI, the industry's AUM is expected to grow at a 23 percent CAGR for the next 5 years and reach $936 billion by 2023.
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"Due to growing investor awareness and increasing mutual fund penetration, we anticipate that the Indian asset management space will experience significant long-term growth," said Dhiraj Poddar, Country Head of India at TA Associates Advisory Private Limited who also will join the Prudent Board of Directors. "Because of this trend, we have spent a fair amount of time and resources tracking the Indian asset management, distribution and allied services space. We believe that Prudent is well-positioned to capitalize in this large and developing marketplace and can provide notable benefits to India's growing wealth management sector."
"Since Prudent's founding, we have strived to provide the highest quality end-to-end services and training programs for our network of IFAs to ensure that we are positioning them for success," said Shirish Patel, Chief Executive Office of Prudent Corporate Advisory Services. "With TA's investment, we will look to scale the business to meet the evolving needs and goals of our dedicated client base. We welcome TA as an investor in Prudent and are eager to begin working with their talented team of investment and operating professionals."
DSK Legal provided legal counsel to TA Associates. Shardul Amarchand Mangaldas & Co. provided legal counsel to Prudent.