Ananya Birla’s Svatantra Microfin Private Limited (Svatantra), has entered into a definitive agreement to acquire Chaitanya India Fin Credit Private Limited (Chaitanya), a wholly owned subsidiary of Navi Group (Navi) on Tuesday.
The transaction of INR 1,479 Cr is expected to be completed by the end of 2023, subject to receipt of regulatory approvals and customary closing adjustments.
The proposed acquisition is expected to transform the microfinance landscape, catapulting Svatantra into the second largest microfinance entity in India with a reach of more than 3.6 million active customers through 1,517 branches across 20 states and a combined AUM of INR 12,409 Cr as on March 31, 2023.
Svatantra and Chaitanya are new generation NBFC-MFIs with a strong track record of growth and profitability, leveraging technology to create impact and offer financial services to rural India.
On the development, Ananya Birla, Founder and Chairperson of Svatantra, said, “Over the years, the Indian Microfinance industry has been a catalyst in the profound transformation of the Indian financial services sector by democratising finance.” she added, “The proposed acquisition will propel Svatantra to a significant leadership position. The combined entity will command a substantial reach, enabling the delivery of a diverse array of financial services to our clients across a geographically diverse portfolio.”
The company is committed to being a responsible lender, and Birla believes their synergistic strengths and shared ethos will accelerate our ongoing journey to create a unique, valuable and impactful financial services entity.
“We are pleased to announce the proposed sale of Chaitanya to Svatantra,” said Navi Chairman and CEO, Sachin Bansal. “We have seen Chaitanya grow almost 6X in the last 4 years, making credit accessible to rural India. This transaction is in line with our strategic plan to focus on our digital-first businesses, as we continue our digital-first financial services through the Navi Group. We believe that Svatantra is a good fit for Chaitanya and that the company will continue to grow and prosper with the combined expertise of both teams.”
JM Financial Limited acted as the exclusive financial advisor to Navi for this transaction.
Svatantra is a microfinance entity, which offers microcredit at affordable rates in the country. Svatantra today with a team of 7,000+ employees serve over 2.2 million rural customers across 19 states with an AUM of INR 7,499 Cr (as on March 31, 2023). Svatantra’s compounded growth rate is that of 118% (FY15-23).
Chaitanya, founded in 2009, has focused on servicing rural India digitally with support from its parent company Navi, and making credit accessible to all of rural India. Chaitanya services 1.4 million customers across 12 states in India with an AUM of over INR 4,900 Cr. It had a net worth of INR 721 Cr as on March 31, 2023 which was shored up through a further capital raise of INR 75 Cr in June 2023.
