DHFL Exits Mutual Fund Business As PGIM Completes Buyback
Dewan Housing Finance Corporation Ltd. has exited mutual fund business by selling its entire stake in DHFL Pramerica Asset Managers to PGIM Inc., the asset management arm of Prudential Financial Inc.
DHFL Pramerica Asset Managers was a joint venture of DHFL and PGIM. The U.S.-based firm has $1.2 trillion in assets under management globally.
The deal, which was first announced in December 2018 as the DHFL crisis deepened, has received necessary approvals including from capital markets regulator Securities and Exchange Board of India. DHFL Pramerica's assets under management fell by Rs 2,216 crore in the June quarter to Rs 5,412 crore.
In a statement, PGIM Inc. said that its Indian mutual fund house will now be called PGIM India Mutual Fund, subject to regulatory approvals. It also announced the appointment of Srinivas Rao Ravuri as the chief investment officer for equities.
According to PGIM Global Chief Executive Glen Baptist, the acquisition of DHFL’s stake in DHFL Pramerica Mutual Fund should be seen as a "deep commitment" to deliver high quality and innovative solutions for long-term investment needs of people.
PGIM India CEO Ajit Menon said it has a network spread across 27 cities.
Default-prone DHFL is under severe stress, thanks to the liquidity crunch at non-bank lenders following the IL&FS crisis that started in September last year. It has been forced to sell its non-core assets. The Wadhawan family, promoters of the company, are also weighing a stake sale to pay off debt.