MICROCAPITAL BRIEF: Intellecap’s IntelleCash Microfinance Network Purchases 56% Stake in Arohan Financial Services of India

IntelleCash Microfinance Network, a subsidiary of the India-based social-sector advisory firm Intellectual Capital Advisory Services (Intellecap), reportedly has purchased a 56-percent stake in Arohan Financial Services, an Indian microfinance institution (MFI), for INR 520 million (USD 10 million). Other stakeholders in Arohan include the India Financial Inclusion Fund (IFIF), a Mauritius-based fund that focuses on equity investments in Indian MFIs; the Michael and Susan Dell Foundation, a US-based nonprofit; and Aavishkaar Goodwell II, an Dutch-Indian for-profit business development company.

In 2011, Arohan reported total assets of USD 10.2 million reaching 107,000 borrowers in India. It also reported return on assets of -16.2 percent and return on equity of -80.3 percent. Arohan reportedly seeks to double its assets to INR 1 billion (USD 19.2 million) by March 2013. Arohan does not take deposits but offers life insurance.

By Charlotte Newman, Research Associate

About Arohan Financial Services
Arohan is a microfinance institution (MFI) based in Kolkata, India. Founded in 2006, it offers loans and life insurance primarily in urban areas of eastern India. In 2011, Arohan reported total assets of USD 10.2 million reaching 107,000 borrowers in India. It also reported return on assets of -16.2 percent and return on equity of -80.3 percent.

About Intellecap
Intellecap is a social-sector advisory firm that aims to provide market-based solutions to enhance the business practices of social enterprises. Its services include microfinance development, technology solutions, investment banking and business consulting. It currently operates in both India and the US. Financial information is unavailable for Intellecap.

About India Financial Inclusion Fund
The India Financial Inclusion Fund (IFIF) is based in Mauritius and focuses on equity investments in Indian microfinance institutions (MFIs) and other providers of financial services to the poor such as low-cost housing providers and microfinance technology companies. The fund is advised by Caspian Advisors Private Limited, an Indian investment management company that specializes in microfinance investment funds. IFIF also provides technical advice and risk capital.

About Michael and Susan Dell Foundation
The US-based nonprofit Michael & Susan Dell Foundation was established in 1999 to aims to improve global education, childhood health and family economic stability. The foundation has committed approximately USD 700 million to nonprofit organizations working in communities in the United States, South Africa and India. As of 2010, the foundation reported total assets of USD 906 million.

About Aavishkaar Goodwell India Microfinance Development Company
Aavishkaar Goodwell is an Indian-Dutch joint venture that is looking to build a portfolio of USD 25 million in 30 to 40 microfinance start-ups and 8 to 10 growing microfinance institutions (MFIs). The investment team in India works alongside the group that manages Aavishkaar India Micro Venture Capital Fund. The Dutch microfinance private equity company Goodwell Microfinance Development Company is the leading investor in Aavishkaar Goodwell, along with development finance institutions and commercial banks including the Netherlands Development Finance Company (FMO in Dutch), the World Bank’s International Finance Corporation (IFC) and Germany’s Deutsche Bank.

Sources and Additional Resources:

Live Mint: “IntelleCash cquires Arohan MFI,” http://www.livemint.com/Companies/Dy3Z439qXwf002xuy2YAqO/IntelleCash-acquires-Arohan-Microfinance.html

MicroCapital.org story, February 3, 2012, “MICROCAPITAL BRIEF: ICRA Raises Rating for Arohan Financial Services Pass Through Certificates for $1.4m Securitization of Microfinance Loans,” https://www.microcapital.org/microcapital-brief-icra-raises-rating-for-arohan-financial-services-pass-through-certificates-for-1-4m-securitization-of-microfinance-loans/

MicroCapital.org story, December 17, 2009, “MICROCAPITAL BRIEF: Intellecap’s 2009 Srijan Awards Go to Arohan, Grama Vidiyal, Sahayata Microfinance, Vortex Engineering,” https://www.microcapital.org/microcapital-brief-intellecaps-2009-srijan-awards-go-to-arohan-grama-vidiyal-sahayata-microfinance-
vortex-engineering/

MicroCapital Universe Profile: Arohan Financial Services
http://microcapital.org/microfinanceuniverse/tiki-index.php?page=Arohan

MicroCapital Universe Profile: Intellecap
http://microcapital.org/microfinanceuniverse/tiki-index.php?page=Intellecap

MicroCapital Universe Profile: India Financial Inclusion Fund
http://microcapital.org/microfinanceuniverse/tiki-index.php?
page=India+Financial+Inclusion+Fund+%28IFIF%29

MicroCapital Universe Profile: Michael and Susan Dell Foundation
http://microcapital.org/microfinanceuniverse/tiki-index.php?
page=Michael+and+Susan+Dell+Foundation

MicroCapital Universe Profile: Aavishkaar Godwell India Microfinance Development Company
http://microcapital.org/microfinanceuniverse/tiki-index.php?
page=Aavishkaar+Goodwell+India+Microfinance+Development+Company+Ltd

Do you know that MicroCapital publishes the MicroCapital Monitor newspaper each month? Find out more at https://www.microcapital.org/products-page/

Similar Posts: