New Delhi, Feb. 10 -- Private equity firm Carlyle is acquiring a majority stake in the mortgage lending arm of Edelweiss Financial Services Ltd, marking its return to a sector where it has previously invested in three other housing finance companies over the past two decades.
Carlyle, via its Asia fund, will invest about Rs 2,100 crore (about $230 million) in Nido Home Finance Ltd, currently a wholly owned subsidiary of Edelweiss. The transaction includes acquiring a 45% stake in Nido from Edelweiss and a primary capital infusion of Rs 1,500 crore, the Indian company said in a press release.
Aditya Puri, senior advisor to Carlyle in Asia and former CEO and managing director of HDFC Bank, will also participate as an investor. Puri's Salisbury Investments will contribute Rs 10.7 crore to the fresh capital infusion. Puri retired from HDFC Bank in 2020 and joined Carlyle the same year as a senior advisor.
The transaction marks Carlyle's return to India's housing finance sector as well as to the Mumbai-based Edelweiss Group. The PE firm had first invested in Edelweiss Financial in late 2011 and exited in 2017.
In the housing finance sector, it had invested in Housing Finance Development Corp and Repco Home Finance in 2007. It exited HDFC in 2012 and Repco two years later. HDFC was merged with HDFC Bank in 2023. In 2015, Carlyle invested in PNB Housing Finance. It fully exited PNB Housing last year, generating benchmark returns on its decade-long bet, VCCircle reported at the time.
Carlyle is the second US buyout firm to invest in an Indian mortgage lender in as many weeks. Earlier this month, Advent International agreed to invest Rs 2,750 crore ($305 million) for a 14.3% stake in Aditya Birla Housing Finance Ltd.
Many other PE firms have also invested in Indian mortgage lenders in recent years. Blackstone owns a majority stake in Aadhar Housing Finance Ltd; TPG owns Grihum Housing Finance Ltd, which it acquired from Poonawalla Fincorp; Warburg controls Truhome Housing Finance, earlier known as Shriram Housing Finance; and Swedish buyout firm EQT owns a majority stake in Niwas Housing Finance, which it acquired from Indostar Capital.
In addition, Multiples PE, Prosus, TA Associates and several other investors have backed Vastu Housing Finance. Multiples PE has also invested in Shubham Housing while True North counts Home First Finance India Ltd and Nivara Home Finance Ltd in its portfolio.
Established in 2010, Nido Housing caters to the affordable housing and mass-market segments. It has assets under management of Rs 4,804 crore. Its net profit rose to Rs 18.1 crore in April-December 2025-26 from Rs 9.3 crore a year ago.
"The investment by Carlyle in Nido is a key milestone and brings in a high-quality, long-term partner to accelerate Nido's next phase of growth," said Rashesh Shah, chairman and managing director at Edelweiss Financial.
The transaction is likely to be completed by July 31, subject to regulatory approvals and other condition precedents.
AZB & Partners acted as legal advisors to Edelweiss, whereas Trilegal acted as legal advisor to Carlyle.
Published by HT Digital Content Services with permission from VC Circle.