Blackstone-affiliated entities have announced a significant open offer for Aadhar Housing Finance Limited , marking a major development in the Indian housing finance sector. Here are the key details of this strategic move:

Open Offer Details

• Acquirer: BCP Asia II Holdco VII Pte. Ltd.
• Persons Acting in Concert (PACs): Blackstone Capital Partners (CYM) IX AIV - F L.P. and Blackstone Capital Partners Asia II L.P.
• Target: Aadhar Housing Finance Limited
• Offer Size: Up to 11,35,25,761 fully paid-up equity shares
• Offer Price: ₹469.97 per share
• Total Consideration: ₹53,35,37,01,898.17 (assuming full acceptance)
• Percentage Stake: 25.82% of the expanded voting share capital

Background of the Transaction

The open offer is triggered by a share purchase agreement between BCP Asia II Holdco VII Pte. Ltd. (Acquirer) and BCP Topco VII Pte. Ltd. (Seller). Key points of this agreement include:

• Acquirer to purchase up to 28,20,52,121 equity shares (64.14% stake) from the Seller
• Purchase price not exceeding ₹425 per share
• Total transaction value up to ₹119,87,21,51,425

Strategic Implications

1. Change in Control: Upon completion, the Acquirer will become the new promoter of Aadhar Housing Finance.
2. Reclassification: The current promoter group will be reclassified as public shareholders.
3. Regulatory Approvals: The deal requires approvals from the Competition Commission of India and the Reserve Bank of India.

Offer Timeline

Financial Arrangements

The Acquirer has made robust financial arrangements to fulfill the open offer obligations:

• Bank Guarantees: Two bank guarantees totaling ₹6,15,00,00,000
• Escrow Account: Cash deposit of ₹55,00,00,000

Management's Perspective

The Acquirer intends to support the existing management of Aadhar Housing Finance in their efforts towards sustained growth. The company's focus on providing housing finance to the lower income segment is expected to continue.

Market Impact

This transaction represents a significant move in the Indian housing finance sector, potentially reshaping the competitive landscape. Aadhar Housing Finance's strong position in the affordable housing segment makes it an attractive asset for Blackstone's portfolio.

Investor Considerations

1. Premium Offer: The open offer price of ₹469.97 represents a premium over the recent market price and the share purchase agreement price of ₹425.
2. Future Growth: Blackstone's expertise and financial backing could potentially accelerate Aadhar Housing Finance's growth trajectory.
3. Market Dynamics: The transaction may influence investor sentiment in the housing finance sector.

Shareholders of Aadhar Housing Finance are advised to carefully consider the offer details and consult financial advisors before making a decision. The final outcome of this open offer could significantly impact the company's ownership structure and future strategic direction.

Aadhar Housing Finance , a leading player in the affordable housing finance sector, has reported strong financial performance for the first quarter, demonstrating significant growth across key metrics.

Strong AUM Growth and Disbursements

The company achieved an Assets Under Management (AUM) of Rs 26,524.00 crore, marking an impressive 22% year-on-year growth. This substantial increase in AUM underscores Aadhar Housing Finance's expanding market presence and growing customer base in the affordable housing segment.

Disbursements for the quarter stood at Rs 1,979.00 crore, reflecting a robust 32% year-on-year increase. This growth in disbursements indicates strong demand for affordable housing finance and the company's ability to capitalize on market opportunities.

Profit Growth and Asset Quality

Aadhar Housing Finance reported a 19% increase in Profit After Tax (PAT), which rose to Rs 237.00 crore compared to Rs 200.00 crore in the same quarter of the previous year. This growth in profitability demonstrates the company's operational efficiency and effective cost management.

The company maintained a healthy asset quality, with gross non-performing assets (GNPA) remaining stable at 1.34%. The collection efficiency remained strong at over 98%, reflecting the company's robust risk management practices and the quality of its loan portfolio.

Portfolio Composition and Expansion

Home loans constitute 73% of the company's AUM, while micro-loans against property account for the remaining 27%. The portfolio remains well-secured with an average loan-to-value ratio of 59%. The salaried segment represents 56% of the portfolio, with an average ticket size of Rs 10.00 lakh.

Aadhar Housing Finance has expanded its presence to 591 branches across 22 states, serving over 3 lakh customers. During the quarter, the company added 11 new branches, including its first branch in Assam, marking its entry into the 22nd state.

Strategic Focus on Urban and Emerging Markets

The company has implemented a new strategy focusing on urban and emerging markets. Under this approach, Aadhar Housing Finance has classified approximately 130 branches in the top 15 cities as urban, with the remaining branches categorized as emerging. This strategy aims to drive growth in underserved areas while maintaining a strong presence in established urban markets.

Improved Credit Rating and Financial Metrics

CARE Ratings upgraded the company's rating to AA+ from AA, reflecting its consistent loan book growth, robust capital adequacy, and strong asset quality. The cost of funds stood at 8.00% with an exit portfolio yield of 13.80% and a spread of 5.80%.

Management Commentary

Rishi Anand, Managing Director & CEO of Aadhar Housing Finance, commented on the results: "We are pleased to begin the fiscal year on a very strong and promising note. This quarter has been a continuation of our disciplined execution and strategic focus. Our AUM has reached an all-time high, reflecting the trust of our customers, the dedication of our teams, and the strength of our business fundamentals."

Outlook

Aadhar Housing Finance maintains its growth guidance of 20-22% for AUM and 18-20% for disbursements. The company remains optimistic about the affordable housing finance sector, supported by government initiatives, urbanization trends, and increasing demand from first-time homebuyers.

With its strong financial performance, expanding reach, and strategic focus on emerging markets, Aadhar Housing Finance is well-positioned to capitalize on the growing opportunities in the affordable housing finance segment.