B K Modi-led Spice Group has embarked upon a takeover hunt in insurance and mutual fund sectors, as part of plans to establish itself as a leading player in the entire spectrum of financial services business.
To steer its expansion into this fast-growing segment of the economy, Spice Group has snapped up Anil Ambani Group firm Reliance Money's former chief Sudip Bandyopadhyay, who has drawn up mega plans for the NRI industrialist's new venture.
"We have engaged investment bankers to identify suitable acquisition targets among the existing insurance and mutual fund companies in the country," Bandyopadhyay told PTI over phone from Mumbai.
The financial sector veteran, who helped set up and nurture Reliance Money into the country's leading brokerage and financial services distribution firm, said that a few potential targets have already been identified and the talks would advance further if right valuations could be achieved.
He said these were insurance and asset management ventures, but declined to name them.
Besides India, Bandyopadhyay said, he would also look at acquiring money transfer companies in neighbouring nations like Sri Lanka, Nepal and Bangladesh.
"In India, we are looking at suitable acquisition opportunities in insurance and mutual fund segments, but would go for greenfield expansion for businesses like broking and microfinance," Bandyopadhyay added.
Modi Group, last year, sold its over 40 per cent stake in mobile operator Spice Communications to Idea Cellular for Rs 2,200 crore. Seeking to diversify itself into IT space, it had earlier this year had shown interest in acquiring Satyam after the scam broke out in the IT firm, but lost to Tech Mahindra.
Bandyopadhyay, who has joined Spice as Group president, financial services, after an over-four year stint at R-Money, "Our aim is to be present in entire spectrum of financial services market -- from money transfer, broking, distribution, micro-finance to insurance and mutual fund."
At present, there are over three dozen fund houses in the country, among which only market leader Reliance Mutual Fund has a corpus of over Rs 1,00,000 crore, while that of HDFC MF, ICICI Pru, UTI MF and Birla Sunlife are above Rs 50,000 crore.
A number of fund houses, such as Bharti AXA, Edelweiss, Escorts, Mirae Asset, Quantum, Sahara, Shinsei and Taurus have a corpus of below Rs 1,000 crore.
Spice Finance will be the holding company for the Group's new ventures in the financial services business. The Group has already acquired over 60 per cent stake in Wall Street Finance, which is into money changing and transfer business.
Spice Group, present in telecom, entertainment, IT & BPO and retail real estate businesses, acquired about 51 per cent stake in September in Wall Street Finance and later raised it to 61.8 per cent.
