In a strategic development with implications for the gold loan sector, L&T Finance has acquired the gold loan business of Paul Merchants Finance Pvt Ltd (PMFL). This acquisition, valued at ₹537 crore, marks the Larsen and Toubro Group NBFC’s entry into the lucrative gold loan market, expanding its portfolio of secured loan products.
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The all-cash deal, structured as a slump sale, includes a lumpsum consideration of ₹537 crore, with additional adjustments to be made before the deal closes. The transaction is subject to regulatory approvals and expected to finalise by the second quarter of financial year 2025-26.
The acquisition includes a fully operational network of gold loan branches across strategically important markets such as Chandigarh, Punjab, Haryana, Delhi, Rajasthan, Gujarat, Madhya Pradesh, and Uttarakhand.
It also provides L&T Finance with a 24/7 security centre for remote monitoring of all gold loan branches. The transaction brings on board approximately 700 employees and 130 branches.
The gold loan business comes with assets under management (AUM) of approximately ₹1,000 crore and over 98,000 active customers, providing a strong foundation for scaling operations quickly.
Commenting on the acquisition, Sudipta Roy, Managing Director and CEO of L&T Finance, said, “This acquisition is a significant step towards achieving sustainable growth and attractive returns. The addition of gold loans will strengthen our portfolio by filling the gap for secured high-yield products, catering to both rural and urban markets. It will expedite our gold loan business expansion by 36 months.”
The shares of L&T Finance ended down 1.30% today (February 7) at ₹148.80.
