Reliance Capital Asset Management (RCAM), a part of Anil Ambani led Reliance Capital has signed definitive agreements to acquire Goldman Sachs Asset Management’s (GSAM) onshore business in India.
Reliance Capital Asset Management will pay a total sum of US$ 37.5 million in cash to acquire all onshore mutual fund schemes, including exchange traded funds, of GSAM India. The Boards of both the companies – Reliance Capital Asset Management and Goldman Sachs Asset Management India – have already approved the transaction. The transaction is expected to be completed by the end of this fiscal year, subject to necessary regulatory approvals.
“This acquisition by RCAM is an important first step in our overall strategy to strengthen our businesses through selective inorganic growth. We are confident that it will complement and enhance RCAM’s overall offerings to our investors” said Mr. Sam Ghosh, Executive Director, Reliance Capital.
“We are pleased to have reached an agreement on the transfer of our onshore funds to RCAM. GSAM will continue to deliver global asset management services to Indian clients and will remain a significant investor in Indian securities through regional and global managed GSAM funds. In the meantime, we remain committed to growing our investment banking and securities franchise in India and we continue to feel extremely positive about India as an important and growing market for Goldman Sachs overall”, said Sonjoy Chatterjee, Chairman, Goldman Sachs India.
“The transaction will add over half a percent in our market share. We will ensure that we maintain seamless continuity for all GSAM India fund investors across all schemes. Going forward we would be willing to consider more such acquisitions that add to our strength and complement our portfolio”, said Mr. Sundeep Sikka, CEO, Reliance Capital Asset Management.
GSAM India currently manages 12 mutual fund schemes, including 10 ETF schemes, and is the largest ETF provider in India. It has a total AUM of US$ 1.1 billion as of September 30, 2015 which includes US$ 334 million of AUM in the Central Public Sector Enterprises (“CPSE”) ETF for which GSAM India is currently the exclusive fund manager.
As part of the transaction, RCAM will extend offers of employment to substantially all of GSAM India’s employees dedicated to supporting the ETF business.
GSAM India is a part of Goldman Sachs Asset Management, the asset management arm of the Investment Management Division of The Goldman Sachs Group, Inc. (NYSE: GS), which oversees $1.19 trillion in assets under supervision as of September 30, 2015.
