Warburg-affiliate Orange Clove Investments BV has signed a definitive agreement with Home First Finance Company in this regard, it said in a statement.
The global private equity major added that the investment will be a combination of primary fundraising and secondary sales by existing shareholders True North and Bessemer Venture Partners.
Warburg did not say how much equity it will pick up for the money being invested or the valuation at which the investment is being made.
The city-based Home First is an affordable housing-focused finance company providing loans to first-time homebuilders and buyers. Over the past 10 years, it has sanctioned home loans to over 50,000 customers across 11 states but majorly in Gujarat, Maharashtra, Karnataka and Tamil Nadu.
It closed 2019-20 with a loan book of Rs 3,618 crore and had a networth of Rs 933 crore and gross bad loans of 0.87 per cent. The statement did not say how much is its profit for the year.
“Warburg’s investment is an acknowledgement of our inherent strengths — focus on the salaried customers, investments in technology, which have all helped us,” said Home First Chief Executive Officer Manoj Viswanathan. True North has been a strong partner for the past few years and has supported the firm in business in tight market conditions, he added.
Warburg Managing Director Narendra Ostawal said Home First has had a remarkable journey in a relatively short span of 10 years. We are keen to partner with True North and back the Home First management in its next phase of expansion.
True North Partner Divya Sehgal said they look forward to partnering with Warburg Pincus in the upcoming journey of Home First.
The New York-based Warburg has over USD 53 billion in private equity assets under management invested across 185 companies across sectors and geographies.
Founded in 1999, True North is a leading home-grown private equity firm with a focus on investing in and transforming mid-sized profitable businesses into large well-established businesses.
True North has launched six separate investment funds with a combined corpus of USD 3 billion, including co-investments through which it has added value to over 50 businesses over the past 20 years.
Ambit Capital was the lead advisor on the transaction, while Axis Capital was the co-advisor.