HDFC buys 15% stake in Tanzania's First Housing Finance Co

New Delhi: As part of greenfield expansion outside India, country's largest mortgage lender HDFC Ltd has acquired a 15 per cent stake in Tanzania's First Housing Finance for USD 1.5 million.

First Housing Finance (Tanzania) is the first housing finance company in the country that still has to commence operations.

HDFC said the acquisition has been done "to promote a greenfield housing finance company in Tanzania."

"HDFC and its wholly-owned subsidiaries, together with International Finance Corporation (IFC) have in the past, participated in the development of nascent housing finance markets in Asia and Africa," it said in a regulatory filing.

The acquisition has been executed through HDFC Investments in which 32.7 million equity shares, equivalent to 15 per cent share capital of First Housing, have been bought at a cash consideration of USD 1.5 million.

Among others, First Housing Finance shareholders include three local partners-- Bank M Tanzania Plc, Armut Ltd and Sanjay Suchak.

Bank M has a shareholding of 40 per cent in the company and the rest of shareholders have 15 per cent each.

The objective of the company is to provide housing loans to Tanzanians.

Mortgage finance penetration in Tanzania is very low and the company will commence operations shortly, HDFC said.

Stock of HDFC closed 0.79 per cent up at Rs 1,582.60 on BSE.