L&T Finance acquires Fidelity’s fund business in India

L&T Finance Limited, a subsidiary of L&T Finance Holdings Limited (LTFH), has agreed to acquire FIL Fund Management Private Limited (Fidelity AMC) and FIL Trustee Company Private Limited, the companies carrying on the mutual fund business of Fidelity in India, subject to regulatory approvals, L&T Finance said in filings with the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE).

Fidelity's Indian AMC, incorporated in 2004, is the fifteenth largest mutual fund in the country with a market share of 1.3 per cent and assets under management of Rs8,881 crore for the quarter ended December 2011 (68 per cent of its assets being equity oriented).

With a robust equity oriented franchise and access to large HNI customers and a strong SIP portfolio, Fidelity's equity assets in India are the 10th largest with a market share of 3.1 per cent. Fidelity AMC in India had 4 of its 5 equity funds ranked amongst the top 10 in the respective category, the company said in its filing.

It was adjudged as the `Best Equity Fund House' by Lipper in 2011.

"With this acquisition we are one step closer to achieving our vision of being among the top players in the Indian mutual fund industry. We remain committed to that goal and look forward to building one of India's most admired asset management businesses. This acquisition provides L&T Mutual Fund the necessary scale, products and access to retail customers to grow profitably," Y M Deosthalee, CMD of L&T Finance Holdings Limited, said.

L&T Financial Services established its presence in the mutual fund industry through the acquisition of the mutual fund business of DBS Chola in January 2010. Since then, L&T Mutual Fund has grown its total average AUM by a CAGR in excess of 33 per cent to Rs4,616 crore (average AUM for the quarter ended December 2011). It has a strong debt–focused portfolio with a pan India distribution network.