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Muthoot Finance acquires stake in Sri Lanka company

Kerala-based Muthoot Finance has acquired 51% stake in Sri Lanka’s Asia Asset Finance, which is a deposit taking non-banking financial company in the country, regulated by Central Bank of Sri Lanka. George Alexander Muthoot, MD, Muthoot Finance, said Muthoot Finance took the initiative to invest in the company because Asia Asset Finance wanted to do gold loan business and they wanted a strategic partner. He said Muthoot Finance felt that there is lot of value to be added by the company by joining them and that was the reason Muthoot invested in that company. Asset Finance now started gold loan business in that company. Muthoot Finance believes that there is a lot of scope in gold loan business in Sri Lanka as economic activity in that country has improved and people are interested to borrow against gold. Muthoot Finance is also looking towards increasing its stake in the company by pumping more capital. The company has paid around Rs 30 crore to acquire the stake and the deal has been funded by internal accruals, said Mr Muthoot.

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