CCI approves Sumitomo Mitsui’s acquisition of Fullerton India

The proposed combination relates to the acquisition of equity share capital of FICC by SFMG. It is in the nature of an acquisition and falls under Section 5(a) of the Competition Act, 2002, the ministry of corporate affairs stated in a release.

SMFG will buy out Fullerton India in two steps - by acquiring a 74.9 per cent stake from Fullerton and a 25.1 per cent stake from Angelica investments.  

Sumitomo will pay $2 billion for a 74.9 per cent stake as the Japanese bank intends to expand its business in Asia. This marks the first entry into South Asian country by the bank.    

SMFG is the holding company of Sumitomo Mitsui Banking Corporation (SMBC) and its other group companies. Its primary business is to manage its banking subsidiaries and other companies. Apart from commercial banking, the SMBC group is also engaged in a diverse range of financial services, including leasing finance, project finance, real estate financing, securities and derivatives, maritime finance, consumer finance, credit card, trade finance, cash management, etc.

FICC is wholly owned by Singapore’s state investment fund Temasek Holdings.  

FICC is registered as a non-banking financial company with the Reserve Bank of India. It is primarily engaged in the provision of loans such as loans for commercial vehicles and two- wheelers, loans against property, loan against securities, personal loans, loans extended to real estate developers, loans extended to businesses, and loans for rural solidarity group. 

Fullerton India Home Finance Company Limited (FIHFC), a wholly-owned subsidiary of FICC, is registered with the National Housing Bank as a non-deposit taking Housing Finance Company (HFC).

FICC began its operations in 2007 under FFH, which is a wholly-owned subsidiary of Singapore’s Temasek. The acquisition marks a step towards fully divesting Fullerton India Credit Company.  

CCI is expected to issue a detailed order on the investment later.