Fairfax India Holding Corporation, one of the largest public shareholders in IIFL Finance, has agreed to invest $200 million in liquidity support to the company, an exchange filing from the company said. However, the mode in which the liquidity support will be provided to the company, has not been specified.
Fairfax India said that the liquidity support is in response to the concerns amongst the company's investors and lenders post the RBI action. The infusion will be done on terms that are yet to be mutually agreed and subject to applicable laws.
"We have been long-term investors in the IIFL Group of companies and have full trust and confidence in the company's strong management team led by Nirmal Jain and R Venkataraman. We are confident that Nirmal and Venkat will take corrective actions to meet and exceed RBI's compliance standards," Fairfax India chairman Prem Watsa said.
IIFL Finance Director and Founder Nirmal Jain called Fairfax's proposal "generous" along with "very timely" and "motivating." He added that the company is fully committed to comply fully with the Reserve Bank of India's Directives.
Based on the December quarter shareholding pattern Fih Mauritius Investments, a Fairfax entity, held a 15.12% stake in IIFL Finance.
