Shriram Finance has denied a Bloomberg report that claimed Mitsubishi UFJ Financial Group (MUFG) is seeking majority ownership in the business.
In a stock exchange filing, the India-based company dismissed the report as “based on speculation”.
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The Bloomberg report had said that the Japanese lender is examining whether to raise its existing holding of approximately 20% in the Indian financial conglomerate to above 50%.
Achieving this threshold could require an equity injection exceeding $10bn, the news agency had said.
Citing unnamed sources, it added that discussions are in a preliminary phase, and no timetable has been established.
The prospect aligns with comments made in December by an executive at the Japanese institution, who indicated that increasing ownership in Shriram was an option over the longer term, though no formal decision had been taken at the time.
Committing upwards of $10bn would build upon the $4.4bn already deployed by MUFG, bringing its cumulative capital allocation in Shriram to more than $14bn.
MUFG established its initial 20% stake in Shriram Finance through a $4.4bn transaction.
That purchase priced Shriram at more than $20bn and allotted MUFG two board seats.
Shriram maintains an established lending footprint that foreign banks have seldom constructed independently, targeting borrowers frequently unserved by conventional institutions, the report noted.
The potential acquisition reflects the convergence of Japanese banking groups seeking external geographical expansion and international capital deploying into India.
The approach mirrors recent moves by peer institutions, including Sumitomo Mitsui Financial Group establishing itself as the principal shareholder in Yes Bank, and Mizuho Financial Group contracting to secure control of the investment bank Avendus Capital.
