Sundaram Asset Management Company Ltd. (“Sundaram”), a 100% subsidiary of Sundaram Finance Ltd., has received regulatory approval for the purchase of the asset management businesses of Principal Asset Management Pvt. Ltd. (“Principal India”). Sundaram will acquire the schemes managed by Principal India and acquire 100% of the share capital of Principal Asset Management Pvt. Ltd., Principal Trustee Company Pvt. Ltd., and Principal Retirement Advisors Pvt. Ltd., originally announced on 28th of January 2021.

Leadership from both companies are pleased to report the receipt of final regulatory approvals for the purchase from the Competition Commission of India (CCI) and from Securities and Exchange Board of India (SEBI). The transaction is subject to compliance with SEBI prescribed processes and fulfillment of mutually agreed conditions precedent to deal closure. As per regulatory requirements, there will be an ‘exit load free window’ for investors to redeem their investments, where such exit load is applicable.

Post deal closure, the schemes currently managed by Principal India and Sundaram will either be merged or renamed as Sundaram schemes in their respective categories. All investors and distributors of Principal India schemes will become investors/distributors of Sundaram. Thus, a wider range of equity schemes will be available to the more than two million combined investor base and to the strengthened distribution franchise across the country-wide network of 88 branches.

Commenting on the acquisition, Mr. Sunil Subramaniam, Managing Director, Sundaram Asset Management Company, said: “We look forward to complementing our existing Equities fund management talent with the addition of the team from Principal India. We endeavor to retain and absorb Principal India’s distribution franchise with minimal disruption to their commercial terms. The existence of the same back-office service provider (RTA) is expected to smoothen the transition for existing customers and distributors.”

“As Sundaram acquires our India asset management and retirement advisory businesses, our top priority is to ensure the best outcome and a smooth transition for our customers, distributors and employees,” said Mr. Pedro Borda, Chief Operating Officer, Principal International. “We are confident they will benefit from Sundaram’s expanding mutual fund platform.”

Mr. Harsha Viji, Executive Vice Chairman of Sundaram Finance, added: “This acquisition is a natural step in our aspiration to become a sizeable player in the asset management industry. The combined business of both the entities will achieve an aspirational landmark of INR 50,000 cr! We will be able to leverage the combined platform to derive significant synergies. The focus for us will be on delivering a better experience to our investors and distribution partners.”

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