Japanese banks and Grab fight over $2 billion in mortgage assets

(Bloomberg) – Japanese lenders Mitsubishi UFJ Financial Group Inc., Mizuho Financial Group Inc. and Sumitomo Mitsui Financial Group Inc. are among shortlisted suitors in the bidding for consumer lender Home Credit’s assets in South Asia. Southeast and India, according to people familiar with the matter.

Grab Holdings Ltd., the Southeast Asian ride-sharing and delivery giant, also moved into the next round, the people said, asking not to be identified as the matter is private. The owner is seeking a $2 billion to $2.5 billion valuation for businesses in Indonesia, Vietnam, the Philippines and India, they said.

Some bidders have expressed interest in acquiring the entire Southeast Asia and India portfolio, while others are only interested in Southeast Asia, the sources said. Discussions are ongoing and the companies could still decide not to pursue a transaction, the sources said.

Home Credit, owned by the family of late Czech billionaire Petr Kellner, has been in talks with advisers about options, including partnerships and sale stakes in Southeast Asia and India, to help raise funds for the group, Bloomberg News reported.

Japanese lenders have been ardent buyers of assets across Asia in recent years as they seek to expand into new markets amid low interest rates and sluggish growth at home. For Grab, which suffered bigger-than-expected losses and a 55% drop in its share price, a purchase of Home Credit’s assets could help diversify and grow its financial services unit. Last year, Grab increased its stake in Indonesian mobile wallet provider Ovo to around 90% by acquiring shares in PT Tokopedia and Lippo Group.

Representatives of Japanese banks and a representative of the Kellner family’s investment firm, PPF Group NV, declined to comment. A representative for Grab did not immediately respond to requests for comment.

PPF canceled a $1.5 billion share sale in Hong Kong for Home Credit in November 2019, citing market conditions. Kellner died aged 56 in a helicopter crash last year.

Home Credit was founded in 1997 and is present in nine countries in Asia, Central and Eastern Europe and the former Soviet Union. After the fall of communism in the Czech Republic, Kellner forged PPF Group, a holding company whose interests span finance, telecommunications, manufacturing, media and biotechnology.

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