Warburg Pincus leads Rs 520 crore equity round of Fusion Microfinance

FILE PHOTO: A cashier displays the new 2000 Indian rupee banknotes inside a bank in Jammu, November 15, 2016. REUTERS/Mukesh Gupta/File photo - RTX33SVL

Fusion Microfinance, a leading Non-Banking Financial Company – Microfinance Institution (NBFC-MFI) in India, announced today that it has closed its Series E investment round of INR 520 crores led by an affiliate of Warburg Pincus LLC (“Warburg Pincus”), a leading global private equity (PE) firm focused on growth investing. The investment round includes both a primary fund raise and secondary sale by early-stage investors. This also marks Warburg Pincus’s first investment in the microfinance sector in India. Creation Investment, an existing investor, has also participated in this round. Early investors – Incofin, NMI ,BIO and SIDBI have made successful exit.

This fundraise follows an internal round that the Company completed in February 2018 and significantly expands Fusion’s capital base to support its high organic growth. The Company also intends to selectively evaluate potential acquisition opportunities and lead the potential consolidation in the Industry. Spark Capital was the exclusive financial advisor to the transaction.

According to Devesh Sachdev, CEO and Founder of Fusion Microfinance, “Since inception, Fusion has done significant work in financial inclusion, women empowerment and entrepreneurship. We are very excited about our partnership with Warburg Pincus. This investment would support our endeavour to develop into one of India’s most preferred companies in the financial inclusion space. We are thankful to Incofin, NMI , BIO and SIDBI for having faith in us early on and being supportive of our journey thus far.”

Narendra Ostawal, Managing Director, Warburg Pincus said, “Fusion has had a remarkable journey to become a leading microfinance company in a relatively short period of time. It has demonstrated the ability to profitably scale up in a diversified manner. The company is led by a very talented team, has a robust operating platform and is very well capitalised to become a leader in the financial inclusion space. Warburg Pincus looks forward to backing Devesh and the management team in its next phase of growth.”

Fusion Microfinance was established in 2010 and is the youngest company amongst top 10 pure play microfinance companies in India. It has cumulatively disbursed over INR 5000 crores having started in early 2010. Fusion is a rural MFI with a pan-India presence through 500 branches across about 200 under-developed districts in 18 states of India. It has an outstanding portfolio of INR 2,050 crores, as at September 30, 2018, serving more than 1.3 Mn customers and well diversified across 18 states of India.

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