Axis Capital head, former Edelweiss CEO submit bids for IDFC's brokerage arm

IDFC has received bids from Axis Capital MD and CEO Dharmesh Mehta, and former Edelweiss Securities CEO Vikas Khemani for its brokerage and investment banking division (IBD), sources told The Hindu Businessline.

The bidding process ended on November 20. Some other financial services companies based in Mumbai also expressed interest to purchase the business.

The sale of the IBD is a part of IDFC's plan to sell non-core assets after its merger with non-banking finance company Capital First. The deal is expected to be valued at Rs 500 crore.

IBD is a people-oriented business and therefore, which it makes it easier to ink deals. However, its valuation will depend heavily on the earnings it manages to retain after being sold, the news daily reported.

IDFC's mutual fund business, with assets under management (AUM) worth Rs 70,000 crore, was also on the block. Asset management companies usually get offers from buyers at 4-5 percent price of the AUM.

Mehta is a capital market veteran who has handled over 200 stock offerings, including IPOs and other placements. He joined Axis as part of a deal to purchase Enam, which sold its equity broking firm after the Lehman crisis.

If Mehta's deal is accepted and he leaves Axis, more officials could exit the company looking to join him, sources told the paper.

Khemani worked with Edelweiss for 17 years and resigned earlier this year.