News: Merrill unit buying $200 m loan portfolio from Shriram

(RTR 12/09/2006) Mumbai - An Indian unit of U.S. investment bank Merrill Lynch has agreed to buy a $200 million portfolio of truck loans from Shriram Transport Finance Co Ltd., a senior Merrill official said on Monday.

"Since India is a key market for us, we are developing various businesses, including fund-based business, and this is part of that," said Rajiv Garg, head of global structured finance and investments at DSP Merrill Capital.

"This would be the biggest asset-backed deal for Merrill," said Garg, who began the Indian asset-backed operations about four months ago.

"The quality of assets and the size were the attractions."

Merrill's activity in India is carried out through its 90 per cent-owned main unit, DSP Merrill Lynch. It has separate arms for securities, investment banking and funds management, while DSP Merrill Capital undertakes proprietary businesses.

In a statement, Shriram said it had sold the first tranche of $100 million earlier this month and the next tranche of $100 million would be sold later in the year.

Shriram Transport, in which private equity firm Newbridge has a stake, is a truck loan provider in southern India with headquarters in Chennai.