Money matters | CBI raid | money matter | money matters financial services ltd, moneymatters

Money matters | money matter, money matters financial services ltd, moneymatters

Money Matters Financial Services Ltd. which raised Rs445 crores in November from four top foreign investors, has been under a CBI raid since last night

Money Matters Financial Services Ltd. (MMFSL), a Mumbai-based non-banking finance company (NBFC) was raided by a large team of officials from the Central Bureau of Investigation investigating irregularities regarding market-related transactions attached to politicians.

Money Matters, until recently a small-time NBFC into debt market financial services company (debt syndication, debt placement) managed to raise a stupendous Rs445 crore at Rs625.25 per share in late October through Qualified Institutional Placement (QIP) from top investors to supposedly to grow its asset financing business such as short-term corporate funding, structured product funding, margin funding and acquisition funding to corporates.

The deal had raised a lot of eyebrows. At a time when NBFCs and debt market brokers have been struggling to grow their businesses, it was amazing that a company like Money Matters with little pedigree could raise Rs445 crores from four renowned institutional investors Morgan Stanley, Wellington, Fidelity and GMO. These investors picked up as much as 60% of the placement. The lead manager to the issue was India Infoline.

Rajesh Sharma is chairman and managing director of MMFSL. The CBI is apparently investigating whether MMFSL was involved in deals with political connections. Recently, IL&FS Milestone Fund had picked up a 74% stake in HCC Park, a 1.8 million square feet commercial property located in Vikhroli in Mumbai for around Rs 575 crore. Interestingly, Money Matters Financial Services Ltd was the sole advisor to the deal. HCC’s promoter Ajit Gulabchand, who is setting up a controversial township called Lavasa near Pune, is known in market and business circles to be close to Agriculture minister Sharad Pawar.

The stock of Money Matters which was languishing at Rs7 in late 2007, jumped to around Rs120 in early January 2008 and fell to Rs50 in April 2009. Since then, it rose vertically all the way to Rs787 in the last week of October just after the QIP. Yesterday, the stock was quoted at Rs663.90.

What is today Money Matters, was incorporated as Daiwa Securities Limited on November 15, 1994. The Company’s name was changed to Dover Securities Limited on May 19, 1999 with its registered office at 501, Shubham, 1, Sarojini Naidu Sarani, Kolkata-70001. The registered office was shifted to 1-B, 1st Floor, Court Chambers, 35, Sir Vithaldas Thackersey Marg, New Marine Lines, Mumbai-400020. In March 2008, Dover bought over unlisted Money Matters Securities P Ltd. On 6th October 2008, the name was changed from Dover Securities Limited to Money Matters Financial Services Limited.

Posted by musicking on Nov 24 2010. Filed under Breaking News. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry