After denying rumors in October 2025, Shriram Finance (SFL) has announced the deal with MUFG Bank Ltd., Japan’s largest bank and a part of Mitsubishi UFJ Financial Group (MUFG).
- MUFG Bank will invest Rs 39,618 crore, equivalent to around USD 4.4 billion, in SFL through a preferential issuance of equity shares.
- It will get 20% stake on a fully diluted basis.
- The deal values SFL at $22 bn post money compared with $19 bn pre money currently. Including new shares to be issued after clearance, the current valuation comes to $24bn.
- The proposed investment is subject to shareholder approval and regulatory clearances.
- SFL is expected to benefit from MUFG’s financial strength as well as it’s access to low cost Japanese money.
The fund infusion is expected to significantly enhance SFL’s capital adequacy, strengthen its balance sheet, and provide long-term growth capital to support its future expansion plans. This should transpire to better credit rating for SFL – a key for a NBFC business. SFL is currently at Crisil AA+ stable.
Once completed, this transaction will mark one of the largest foreign investments in India’s non-banking financial sector.