Goldman Sachs Asset Management Company said on Wednesday that it would acquire Benchmark Mutual Fund, an ETF-focussed Indian fund house. Benchmark mutual fund manages assets worth around Rs 3000 crore.
The deal would be finalised by the end of the year, subject to regulatory approvals, said a statement from Goldman Sachs.
An official associated with the deal said Goldman would pay Rs 130.5 crore or approximately 4.3 per cent of Benchmark’s average assets under management (AUM). All Benchmark employees would be retained by the new management, he added. Regulatory approval is expected in the next 3-4 months.
Through the deal, Goldman Sachs aims to bring actively managed on-shore funds into India, added the statement. The financial services major has an office in Mumbai with eight employees, providing research on Indian and BRIC equities for offshore funds.
Goldman Sachs officials could not be contacted for further details.
Benchmark is the country’s only fund house with a sole focus on exchange-traded funds (ETFs). The fund house manages eight ETF products and is credited with launching India’s first ETF – Nifty BeES. The average AUM for ETFs in India is Rs 5,979 crore, according to the Association of Mutual Funds in India. The gold ETF segment has an AUM of about Rs 3,744 crore with 10 products. India’s first Gold ETF – Gold BeES – was conceptualised by Benchmark back in 2007.
MAPE Advisory advised Benchmark in the deal. The Indian MF industry will see further consolidation as the markets become volatile and tough, and big mutual fund players find valuations attractive,” said an industry analyst.
Though Goldman Sachs had received SEBI nod to enter India in September 2008, it kept plans on hold following the economic downturn of 2009.