SVB Financial in Santa Clara, Calif., has agreed to sell a specialty finance business in India at a net loss.
The $36 billion-asset company disclosed in a regulatory filing Friday that it will sell SVB India Finance Private Ltd. to Temasek, a Singapore investment company, for about $46.4 million. The final price will be based on the unit's net asset value.
SVB said it will report an after-tax loss of $11.4 million on the sale, which includes losses tied to foreign currency adjustments, deferred tax liabilities and transaction-related expenses. The company said it expects to record another $1 million of transaction-related expenses in the first quarter tied to compensation agreements.
The sale is expected to close by March 31.
SVB first invested in the Indian unit in 2008. The unit, based in Mumbai, was positioned as India's first and only specialty lending business targeting high-growth entrepreneurial companies backed by top-tier venture capital and private equity investors, according to SVB's website. The unit offers multiple sources of debt capital including venture debt, acquisition financing, growth capital and capex financing.
SVB said in the filing that it is selling the unit "to focus its efforts on other strategic areas of business and growth initiative priorities." The company will "continue to support the innovation economy in India and to work with Indian-based companies as they seek to expand outside of India, largely on a non-lending basis," the filing said.