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Bansal, Poonawallas to invest Rs 100 crore in lending company U Gro

, ET Bureau|
Updated: Oct 07, 2019, 11.08 AM IST
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U Gro started its disbursals in January this year, and has disbursed more than Rs 600 crore in debt to businesses across India.

Highlights

  • The entry of high profile investors will enable the firm to attract more capital in the future.
  • U Gro has disbursed more than Rs 600 crore in debt to businesses across India.
  • Sachin Bansal entered into a non-convertible debenture deal with U Gro.

MUMBAI: Flipkart co-founder Sachin Bansal and the Poonawalla family will invest about Rs 100 crore in the technology-enabled small business -lending platform U Gro Capital through two separate securitisation and bond deals.

The two transactions affirm the trend of technology-enabled financial services firms drawing long-term capital despite a crisis of confidence in the broader NBFC space where funds flow from mutual funds has dried up over the past one year.

U Gro, set up by former Religare Finance chief executive Shachindra Nath, will use the funds to expand its businesses at a time when capital is scarce for the sector.

Nath, executive chairman of U Gro, told ET that the entry of highprofile investors will enable the firm to attract more capital in the future. “These transactions demonstrate our ability to securitise our book at an early stage of our development and establish that besides conventional term–financing, we have the ability to raise resources from alternative channels as well,” Nath said.

Sachin Bansal and the Poonawalla family could not be reached for comments.

U Gro, which last year raised capital from PAG Asia, ADV Partners, Citigroup, Well Fargo, New Quest and Samina Capital, started its disbursals in January this year, and has disbursed more than Rs 600 crore in debt to businesses across India.

The BSE-listed U Gro has done the first securitization transaction with Poonawalla Finance Pvt. Ltd, part of the Poonawalla family, which also owns India’s largest vaccine maker Serum Institute of India. The Poonawalla family is also independently pursuing NBFC operations, and is seeking buyouts in the space, sources said.

Separately, Sachin Bansal entered into a non-convertible debenture deal with U Gro. Bansal, after selling Flipkart to Walmart in a record deal last year, has invested Rs 740 crore to acquire Bengaluru-based non-bank lender Crids. He has also invested in a few other NBFCs, including Altico Capital.
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