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SEBI gives conditional merger approval for HSBC – L&T Investment Management deal

Securities and Exchange Board of India (SEBI) on Tuesday gave HSBC Asset Management (India) Private Ltd conditional approval for the acquisition of L&T Investment Management Limited. HSBC Asset Management Private Limited company under HSBV Holdings Plc is one of the largest asset management company in the country.

Following the completion of acquisition by HSBC Asset Management company, operations of L&T Investment Management Business would be merged with existing asset management operations of HSBC.

Latest statistics suggests that L&T Investment Management has an average of assets worth ₹13,620 crore as of September 2022.

L&T Investment Management is a wholly-owned subsidiary of L&T Finance Holdings Ltd and the investment manager of L&T Mutual Fund.

With average assets under management of ₹71,703 crore and over 22 lakh active folios as of September 2022, it is currently the 14th largest mutual fund management company.

“Strengthening HSBC’s asset management business in India will add to its ability to serve the wealth needs of its customers in India as well as those of its growing non-resident Indian customer base across the world,” HSBC said in a release.

The mutual fund schemes operated by L&T Mutual Fund will be transferred, merged or consolidated with identified schemes of HSBC Mutual Fund or vice-versa. Further, the sponsorship, trusteeship, management, and administration of L&T Mutual Fund will be accordingly changed, it said.

In December 2021, HSBC Holdings Plc’s Indian asset management unit had announced buying out the mutual fund unit of L&T Finance Holdings Ltd for ₹3,191 crore to bolster its wealth management business.

In February 2020, HSBC combined its retail banking and wealth management, asset management, insurance and private banking businesses to create Wealth and Personal Banking which serves over 39 million customers globally.

The proposed deal secured the approval of the Competition Commission of India (CCI) in March 2022.

The parties to the transactions will have to adhere to the conditions and terms stated by Securities and Exchange Board of India in order to get the final approval. Securities and exchange board of India is government agency for implementing securities and capital markets laws in the country. The agency is also responsible for the regulation of security and capital market.