Shriram Finance has approved a ₹3.96 Trillion investment from MUFG Bank Ltd. for a 20% stake in the company. This investment, executed through a preferential issue of shares at ₹840.93 per share, is subject to shareholder and regulatory approvals. The deal includes special rights for MUFG Bank, including board representation, and is expected to enhance Shriram Finance’s lending and credit business.
Significant Investment Approved
Shriram Finance has officially approved a substantial fund raise of ₹3,96,17,98,28,781.15 from MUFG Bank Ltd. (“Investor”). This was announced on December 19, 2025, following a board meeting. This investment signifies a major endorsement of Shriram Finance’s strategic direction and future growth potential.
Details of the Investment
The investment will be executed through the issuance of 47,11,21,055 fully paid-up equity shares with a face value of ₹2 each, priced at ₹840.93 per share. MUFG Bank will acquire a 20% minority stake in Shriram Finance, calculated on a fully diluted basis post-issuance. The Issue Price includes a premium of ₹838.93 per Equity Share.
Special Rights and Conditions
The deal incorporates certain minority protection rights for MUFG Bank, including the right to nominate up to 2 non-independent directors to the Board. These rights are contingent on MUFG Bank maintaining at least a 10% shareholding. The investment is subject to shareholder approval and regulatory clearances, including those from the Reserve Bank of India (RBI) and the Competition Commission of India (CCI).
Non-Compete and Non-Solicit Fee
As part of the agreement, Shriram Ownership Trust will be subject to a non-compete and non-solicitation obligation, for which MUFG Bank will pay a one-time fee of USD 200,000,000, subject to shareholder approval. This fee aims to prevent conflicts of interest and safeguard the Company’s interests.
Restructuring Intent
Shriram Capital Private Limited (SCPL) has expressed its intent to explore and evaluate restructuring options for its holdings in various businesses. This announcement, made on December 18, 2025, indicates a potential separation or reorganization of the lending and credit business of SCPL from its other interests.
Source: BSE