Edelweiss buys back 5.3% from wealth management partner PAG for Rs 230 cr

 According to the agreement, which was to lapse this month, no premium or discount was involved

Edelweiss Wealth Management, among the top-three private wealth managers with Rs 1.81 lakh crore of assets under management, has bought back 5.28 per cent of its shares from the partner PAG by paying Rs 230 crore, thus increasing the stake to 44.16 per cent.

Edelweiss Group Chairman and CEO Rashesh Shah told PTI that the transaction is as per the agreement signed in August 2020 when PAG, which is the world's largest Asia-focused investment group, had picked up 61.5 per cent for around Rs 2,366 crore, and the price paid today for the 5.3 per cent stake is the same it was sold to them last year.

PAG, a leading Asia-focused investment group, continues to be the majority shareholder with a 55.84 per cent stake. "We bought back 5.28 per cent at the same price of what they paid us last year, and it works out to be close to Rs 230 crore," he said.

According to the agreement, which was to lapse this month, no premium or discount was involved, Shah said.

With this transaction, the company's total equity capital has gone up to Rs 1,716 crore. It has closed the first half of the current fiscal with a revenue/fee income of Rs 744 crore and a net revenue of Rs 636 crore and a net profit of Rs 148 crore, of which the group's share was Rs 57 crore.

In August 2020, PAG had acquired a 61.5 per cent stake in Edelweiss Wealth Management for Rs 2,366 crore, including primary and secondary investment, which also included acquiring the entire ownership of two prior investors -- Kora Management and Sanaka Capital taking its stake to 61.5 per cent.

Shah said the top line (revenue) is clipping at 85 percent on an annualized basis and bottom line (profit) at still stronger 85 percent and will close the year with a revenue of Rs 1,500 crore and a bottom line of around Rs 400 crore.