Vikram Pandit, the former chief executive of Citigroup Inc (NYSE:C), will acquire a stake in JM Financial Limited (BOM:523405) and participate in several new initiatives planned by the Indian financial services company.
Pandit and his business partner Hari Aiyar will acquire a 3% stake in JM Financial via warrants.
The Indian company also announced that it was looking to set up a bank, a non-banking financial company (NBFC) and a distressed asset fund. Pandit will be nominated to the post of non-executive chairman of the bank provided that JM Financial obtains a licence from the Reserve Bank of India. Pandit and Aiyar will be given the right to buy shares in the bank up to the limit imposed by the central bank.
In addition, Vikram will be nominated as non-executive chairman of the NBFC and JM Financial will provide USD100m (EUR77.5m) worth of capital to funds raised and managed by a Vikram-led firm. A further USD100m will go towards the initial capitalisation of a distressed asset fund that JM Financial and Vikram will establish together.