State Bank of India and Carlyle To Jointly Acquire GE Capital’s Shares in SBI Card
Boston, Mass., Mumbai & Washington, DC – State Bank of India (SBI, NSE: SBIN), The Carlyle Group (Carlyle, NASDAQ: CG) and GE (NYSE:GE) today announced that they have signed definitive agreements, whereby SBI and Carlyle will acquire GE Capital Group’s (GE Capital) entire stake in SBI Card, the second-largest and fast-growing credit card franchise in India.
SBI Card is operated through two joint-venture companies, SBI Cards & Payment Services and GE Capital Business Process Management Services, which issue credit cards and process card transactions in the Indian market.
The transaction is expected to close by the fourth quarter of 2017, subject to regulatory approvals. Carlyle’s equity for this transaction will come from an affiliated entity of Carlyle Asia Partners IV, Carlyle’s fourth Asia buyout fund focusing on control and significant minority investments in well established companies across the Asia ex-Japan region.
Following the transaction, SBI and Carlyle will own 74% and 26% respectively in each of the two entities. Further details of the transaction were not disclosed.
Dinesh Kumar Khara, Managing Director (A&S), SBI, said, “We welcome Carlyle, our new partner, in the credit card business, and look forward to the new partnership capitalising on the significant opportunities that are opening up in the Indian market, especially in these interesting times of majorly cashless transactions. We also express our deep appreciation for GE, the outgoing partner, who has progressively collaborated with us in building the SBI Credit Card business to the level where it stands today.”
Sunil Kaul, Managing Director of The Carlyle Group, said, “We are delighted to partner with SBI in this landmark transaction. Carlyle's deep experience and operating expertise in the financial services sector, and a track record of successful public-private partnerships, will enable us to be a supportive and value-adding partner to SBI Card. We look forward to working with SBI and the management team of SBI Card to build on the company’s leading position to further expand its business.”
“As we near the end of the process of selling most of the assets of GE Capital, we have worked with our joint venture partner, State Bank of India, to find a solution that works best for all parties,” said Rich Laxer, GE Capital Chairman and CEO. “We’re pleased that we were able to fully exit our stakes in SBI Card and the card processing company. State Bank of India has been a great partner over the last 19 years providing value for customers and we’re certain that will continue in the new partnership with Carlyle,” he added.
As announced in April 2015, GE is focusing on its high-value industrial businesses and is selling most GE Capital assets. GE has retained the financing businesses that relate directly to GE’s industrials. Since the announcement, GE Capital has signed and closed agreements for the sale of approximately US$200 billion of businesses.
Carlyle has invested approximately US$1.6 billion of equity in more than 30 transactions in India across all Carlyle funds as of 03/31/2017.
About State Bank of India
State Bank of India (SBI), the largest commercial Bank in India, is an Indian multinational, public sector banking and financial services company. It is ranked 232nd on the Fortune Global 500 list of the world's biggest corporations as of 2016. It has a sizeable overseas presence with 198 offices in 35 countries across the world.
State Bank of India has a significant presence across the broad spectrum of the financial sector in India with subsidiaries / joint ventures in the area of life insurance, general insurance, investment banking, mutual funds, broking and depository services, custodial services, credit cards, pension fund management, factoring services etc.
On 1st April, 2017, SBI merged all five of its Associate Banks (State Bank of Bikaner & Jaipur, State Bank of Hyderabad, State Bank of Mysore, State Bank of Patiala and State Bank of Travancore) and Bharatiya Mahila Bank with itself. With more than 24,000 branches and 59,000 ATMs, post-merger, SBI is poised to enter the league of top 50 global banks with a balance sheet size of INR 33 trillion, over 270,000 employees and 420 million plus customers.
About The Carlyle Group
The Carlyle Group (NASDAQ: CG) is a global alternative asset manager with $162 billion of assets under management across 287 investment vehicles as of March 31, 2017. Carlyle’s purpose is to invest wisely and create value on behalf of its investors, many of whom are public pensions. Carlyle invests across four segments – Corporate Private Equity, Real Assets, Global Market Strategies and Investment Solutions – in Africa, Asia, Australia, Europe, the Middle East, North America and South America. Carlyle has expertise in various industries, including: aerospace, defense & government services, consumer & retail, energy, financial services, healthcare, industrial, real estate, technology & business services, telecommunications & media and transportation. The Carlyle Group employs more than 1,550 people in 31 offices across six continents.
About GE Capital and GE
The new GE Capital is aligned with GE’s industrial businesses to bring customers cutting edge financial solutions. Learn more at www.gecapital.com.
GE (NYSE: GE) is the world’s Digital Industrial Company, transforming industry with software-defined machines and solutions that are connected, responsive and predictive. GE is organized around a global exchange of knowledge, the "GE Store," through which each business shares and accesses the same technology, markets, structure and intellect. Each invention further fuels innovation and application across our industrial sectors. With people, services, technology and scale, GE delivers better outcomes for customers by speaking the language of industry. www.ge.com
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