MUFG not to have control of Shriram Finance board

Shriram Group will retain control even after the Japanese bank acquires 20% stake in NBFC

- Sakshi Sadashiv

MUFG is investing $4.4 billion in Chennai-based Shriram Finance.

(REUTERS)

Indian financial conglomerate Shriram Group will continue to hold control over the board and management of Shriram Finance Ltd, India's second largest non-banking finance company by assets managed, after Japan's MUFG Bank completes its $4.4 billion investment for a 20% stake in the Chennai-headquartered business, company executives on both sides said on Monday.

MUFG will be classified as a minority public shareholder with board and management control vested with the Shriram Group, said Parag Sharma, managing director & CEO, Shriram Finance, at a press conference.

"We are happy with being at a 20% stake, under which MUFG will be classified as a minority public shareholder with the right to appoint two nominee directors," said Yasushi Itagaki, senior managing corporate executive and group COO-I, MUFG.

"This move is aimed at capturing domestic demand, particularly in the SME segment. Through this partnership, we aim to work across roads, infrastructure and value chains that underpin India's growth."