Shriram Finance approves ₹39,618 crore fund raise from MUFG Bank
Shriram Finance approved raising ₹39,618 crore via preferential issue to MUFG Bank at ₹840.93/share, representing a 20% post-issue stake. An EGM is scheduled for January 14, 2026, to seek shareholder approval. Additionally, a USD 200 million non-compete fee will be paid to Shriram Ownership Trust.
The fund raise of over ₹39,000 crore is substantial and will significantly bolster Shriram Finance's capital base, enabling further expansion and strengthening its financial position. The entry of MUFG Bank as a significant minority shareholder also brings strategic value and potential for future collaborations.
The approval of a significant fund raise from a reputable international bank like MUFG Bank, along with the potential for strategic partnerships and the explicit mention of minority protection rights, indicates a positive development for the company's growth and financial stability.
Shriram Finance Limited's Board of Directors, in a meeting held on December 19, 2025, approved raising funds amounting to ₹3,96,17,98,28,781.15 (₹39,617.98 crore) from MUFG Bank Ltd. The funds will be raised through a preferential issue of 47,11,21,055 equity shares at a price of ₹840.93 per share. This transaction represents a minority investment of 20% of the post-issue share capital on a fully diluted basis.
The preferential issue is subject to shareholder approval, and other regulatory and governmental authorities, including the Reserve Bank of India and the Competition Commission of India. Upon completion, MUFG Bank Ltd. will be classified as a public shareholder.
The Board also approved the execution of an investment agreement with MUFG Bank Ltd., Shriram Ownership Trust, and Shriram Capital Private Limited, along with a Cooperation Memorandum of Understanding. These agreements detail the terms of the preferential issue and establish minority protection rights for MUFG Bank, including the right to nominate up to two directors on the Board, provided its shareholding remains above 10%.
Furthermore, the Board approved the payment of a one-time, non-compete and non-solicit fee of USD 200,000,000 (approximately ₹1,666 crore) to Shriram Ownership Trust, subject to shareholder approval. This fee is part of a Shareholders' Agreement executed between Shriram Capital Private Limited, Shriram Ownership Trust, Sanlam Life Insurance Limited, and MUFG Bank Ltd.
An Extra-Ordinary General Meeting (EGM) of the shareholders has been convened for January 14, 2026, to seek approval for the preferential issue, the non-compete fee payment, and the grant of special rights to MUFG Bank. The meeting will be conducted via video conference.
Separately, Shriram Capital Private Limited (SCPL), a promoter entity, has indicated an in-principle intent to explore restructuring options for its lending and credit business. This is at a preliminary stage, and no final decisions have been made.
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Shriram Finance Limited filed this with the NSE as a statutory disclosure, categorised under equity fundraising. It is a primary document, not a recommendation, and the desk marks it high impact, which is the band that most often changes something.
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See the model portfoliosA plain-language summary of a public exchange filing by Shriram Finance Limited. Read the original for the full detail.