IHC is taking responsibility for debt: Sammaan MD & CEO

Following Abu Dhabi-based International Holding Company's (IHC’s) announcement of an ₹8,850 crore investment in Sammaan Capital for a little over a 41 per cent stake —

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which has triggered an open offer forthe company — Gagan Banga, managing director and chief executive officer (MD & CEO) of Sammaan Capital spoke to Subrata Panda in a telephonic interview and outlined what the investment would mean for the company, and how it planned to leverage this capital to expand its business. Edited excerpts:

What does IHC bring to the table for Sammaan Capital?

Their size, heft, and the amount of capital they manage. Therefore, they bring solidity to the equity cap table. What a billion dollars also means is that they are making a significant commitment — this is not a small side business for them. And most importantly, they are taking over as the promoters of the company. They are basically taking responsibility for the debt, which, from a capital structure point of view, is one of the biggest contributions they will bring to the future growth of the company.

The other thing with IHC, which gels very well in a finance business, is that while private equity pool of capital is great, by their very structure, they also have to think about their investment from a finite time point of view. But when a holding company like IHC is coming in, they are thinking of this as their financial services foray. Therefore, they are thinking of perpetuity, which is the right way of building a finance business.