Religare Buys Major Stake In US Firm

Vanessa Doctor

23 February 2010

Religare Enterprises has signed a definitive agreement to purchase a 65 per cent stake in US-based venture capital and private equity firm Northgate Capital for around $200 million, the Economic Times of India reports.

The deal is expected to close in July this year, the news service said. The move is believed to be part of the company's plan to emerge as a global financial services provider through international acquisitions.

"The partnership will accelerate our process of seeking similar partnerships in other asset classes," Sunil Godhwani, the firm's chief executive officer and managing director, was quoted as having said.

Northgate is run by former National Football Leaguers Mark Harris, Brent Jones, and Thomas Vardell, along with two other founders Hosein Khajeh-Hosseiny and Jared Stone. It has about $3 billion in assets under management. Under the agreement, Northgate's founders will still be in charge of the firm's operations following the acquisition.

Citing sources close to the matter, the publication said that Religare intends to enter asset acquisitions equivalent to 51 to 75 per cent stakes in global firms. The company is said to be planning to list the resulting holding company when its assets hit $100 billion.

Northgate is Religare's second global acquisition after buying UK stockbroker Hichens Harrison in 2008. The Indian company had attempted to take over AIG's asset management business most recently, but lost to Pacific Century.