EXCLUSIVE | Sandeep Tandon's Quant Group likely to buy out Escorts MF

Quant Group, owned by Sandeep Tandon is set to acquire Escorts Mutual Fund, according to sources in know of the development.

An official from Escorts Mutual Fund confirmed and said “the process for acquisition has started,” however, he declined to reveal details such as valuations.

According to the market grapevine, the fund house is likely to announce the acquisition next week.

As of December 2017, the asset under management of Escorts Mutual Fund was Rs 245 crore, down 14 percent from Rs 286 crore, sequentially. While the industry grew exponentially in the last one year, assets of Escorts Mutual Fund fell.

In 2017, mutual fund industry saw its assets base jump to over Rs 22 lakh crore, adding more than Rs 5.4 lakh crore to the kitty, on strong participation from retail investors and investor awareness initiatives.
Escorts Mutual Fund manages Rs 43-44 crore in equity schemes, which is about 18 percent of its total assets under management, according to industry estimates. Typically, the fund house is valued based on the assets in its equity schemes.

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India’s mutual funds industry has already seen a slew of deals, including Prudential Financial Inc’s purchase of Deutsche Asset Management’s India unit and Edelweiss Asset Management acquiring JP Morgan Asset Management’s India unit in 2016.

The fortunes of India’s asset management sector have revived since 2014, when stock markets started a powerful rally, ending years of scant retail interest in mutual funds. Domestic mutual funds have seen net inflows of a record Rs 1.3 lakh crore in equity mutual funds in 2017 in the last calendar year.This the first time a mutual fund distribution and a brokerage firm will be venturing in to the asset management business.

Last year, in August, Essel Finance acquired stake in Peerless Mutual Fund.