IHC Buys $1 Billion Stake in India Shadow Bank, Shares Fall (2)

Abu Dhabi’s largest listed company has agreed to acquire a significant stake in India’s Sammaan Capital Ltd. for about $1 billion, signaling foreign investors’ continued interest in the South Asian nation’s financial services sector.

International Holding Co. PJSC’s unit Avenir will hold about a 43.5% stake in Sammaan after the deal, according to a stock exchange filing Thursday.

Shares of the shadow lender fell as much as 6% in early trade Friday, the most since July. IHC’s acquisition at an 18% discount raises concerns over valuation and potential dilution, said Vinit Bolinjkar, head of research at Ventura Securities. ...