After acquiring 51 per cent stake in domestic money changer and transfer agent Wall Street Finance, the BK Modi Group-promoted Spice Finance is looking to acquire one of Nepal’s biggest money changer and transfer agent, Annapurna Finance, promoted by a local businessman.
The company had around 25 per cent market share in the money changing and transfer business in Nepal and the deal size was likely to be Rs 40-50 crore, said sources in the know. Annapurna is the biggest agent of Western Union Money Transfer chain and has 60 branches in Nepal. The company is a subsidiary of Nepal’s biggest tour operator, Anapurna Travells and Tours Pvt. Ltd, which was established in 1972. After the acquisition, it will become a subsidiary of Wall Street Finance.
The director of Spice Finance, Sudip Bandyopadhyay, refused comment. However, market players said Spice was looking to acquire more such companies in the near future in other neighbouring countries, where there was a flourishing remittance market. Nepal’s majority of population works in India, the UK and the UAE.
Industry players estimate the overall remittance market of Nepal at around Rs 270 crore as against India’s market of over Rs 5,200 crore. Spice Finance had acquired a 36.8 per cent stake in Wall Street Finance from Anil Ambani’s Relinace Money this year, after the latter decided to quit the business. Subsequently, Bandyopadhyay, who was heading Reliance Money, joined Spice Finance.
The Modi group has chalked out a plan to invest close to Rs 500 crore in the financial services sector out of the Rs 2,700 crore it got in 2008 from a stake sale in its mobile services company, Spice Communications. The group plans to foray into insurance, asset management, broking, distribution and micro-finance businesses through both new projects and acquisitions. It has incorporated three subsidiaries under its broking and distribution business, one each for equity, insurance and commodity broking, under a holding company called Spice Bulls. Spice has engaged a top Mumbai-based investment banker, who is looking into the possibility of acquiring a broking outfit in the range of Rs 50-60 crore.
