Bain Cap must address stakes in arms for Manappuram buy

MUMBAI: Bain Capital will need to address its holdings in Tyger Capital and Tyger Housing Finance, acquired from the Adani group, to meet regulatory pre-conditions set by RBI for completing its proposed acquisition of joint control in Manappuram Finance, according to disclosures after the central bank granted approval.

RBI has cleared Bain entities to acquire up to 41.7% stake and joint control in Manappuram Finance, but the approval is subject to conditions. Any increase in shareholding beyond 26% after one year, other than through warrant conversion under the approved structure, will require prior RBI approval. The regulator has also asked Bain to submit an action plan within a stipulated timeline to ensure that it does not control more than one non-banking financial company or housing finance company of the same category.

The approval makes the Manappuram transaction contingent on separate regulatory clearances for its subsidiaries Asirvad Micro Finance and Manappuram Home Finance, and on completion of the mandatory open offer to public shareholders. The investment agreement for the deal was signed in March 2025, and the transaction cannot be consummated until all conditions are met.

These requirements draw attention to Bain’s exposure to Tyger Capital and Tyger Housing Finance. The Adani group entities operate in segments overlapping with Manappuram’s businesses, including agriculture finance, MSME lending and affordable housing. RBI norms do not permit a single investor group to exercise control over multiple NBFCs of same category, a rule aimed at limiting concentration risk and enabling clearer supervisory oversight.

Adani Capital and Adani Housing were acquired by Bain in 2023, when PE firm bought a 90% stake for Rs 1,440 crore, at a valuation of around Rs 1,600 crore. The transaction included Rs 983 crore of primary capital infusion and Rs 409 crore liquidity for growth.