FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Report of Foreign Private Issuer
Pursuant to Rule 13a - 16 or 15d - 16
of
the Securities Exchange Act of 1934
For the month of May, 2008
HSBC Holdings plc
42nd Floor, 8 Canada Square, London
E14 5HQ, England
(Indicate by check mark whether the registrant
files or will file annual reports under cover of Form 20-F or Form 40-F).
Form 20-F X
Form 40-F
......
(Indicate by check mark whether the registrant
by furnishing the information contained in this Form is also thereby furnishing the
information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act
of 1934).
Yes.......
No X
(If "Yes" is marked, indicate below the file
number assigned to the registrant in connection with Rule 12g3-2(b): 82-
..............).
HSBC TO ACQUIRE
7
3.
21
PER CENT
OF
IL&FS
INVESTSMART
IN
INDIA
*** An investment in one of
India
's leading retail brokerages ***
*** Gains a foothold in a market with 20 million retail
investors
***
HSBC, through Group subsidiaries, is to acquire 73.21 per cent
of
IL&FS Investsmart Limited (
"
Investsmart
"
)
, a leading
retail
brokerage house in
India
.
Under the terms of the agreements, HSBC proposes to acquire a 43.85 per cent stake
from E*
T
RADE
Mauritius
Limited
,
an indirectly wholly-owned subsidiary of E*TRADE Financial Corporation,
and
an additional 29.36 per cent from
Infrastructure Leasing and Financi
al
Services Limited
("IL&FS").
Both
shareholders
will receive a price of
INR
200
per share for their respective stakes, making
a total consideration of
INR10,225.5
m
illion
(approximately US$
241.6
million).
In addition, IL&FS will be paid
,
as part of a three-year non-compete agreement,
INR82
0
.
1
million (approximately US$19.4 million)
.
HSBC will
also
make an open offer to
acquire
up to
20
per cent
of
the remaining shares in
Investsmart.
Details of the open offer to Investsmart shareholders
will be published in the Indian press and distributed to shareholders in accordance
with local regulations.
Sandy Flockhart,
Group Managing Director
and Chief Executive Officer of HSBC Asia Pacific, said: "
T
he acquisition of Investsmart is consistent with
HSBC's stated strategy of investing primarily in faster growing
emerging markets
and
India
represents a high priority market for us.
This investment is of strategic importance to HSBC as it gives us a foothold in one
of the largest retail broking markets in the world. With over 20 million retail
investors,
India
has the world's third largest investor base and its National and
Bombay
stock exchanges are respectively the third and fifth largest stock exchanges
globally by transaction volume."
Stuart Gulliver, Chief Executive of Global Banking and Markets
,
said
:
"
This acquisition fits with Global Banking and Markets emerging markets-led strategy
and leverages HSBC
's
global distribution capabilities.
We will benefit from an
expanded institutional broking, equity capital markets and investment banking
platform
in a rapidly growing marketplace that offers great opportunity.
"
Naina Lal Kidwai, Group General Manager and Chief Executive Officer, HSBC in
India
, added: "
Investsmart
'
s retail brokerage business
will b
e a great addition to
o
ur
offering in
India
and
Investsmart's local expertise and strong management team will play a key role
in
strengthening our service proposition
in
India
.
"
HSBC will be making the acquisition through Group subsidiaries, including
HSBC Securities and Capital Markets (
India
) Private Limited, the Group's
securities
arm in
India
.
The agreement and open offer are subject to regulatory and other approvals.
With
a market capitalisation of approximately US$300 million,
Investsmart
is listed on the National Stock Exchange and
the
Bombay Stock Exchange and its Global Depository Shares are listed on the Luxembourg
Stock Exchange.
Gareth Hew
ett
+852 2822 4929
garethhewett@hsbc.com.hk
Vinh Tran
+852 2822 4924
vinhtran@hsbc.com.hk
The HSBC Group in
India
is represented by several entities including The Hongkong and Shanghai
Banking Corporation Limited which offers a full range of banking and financial
services to its over 2 million customers in
India
through its 47 branches and 170 ATMs across 26 cities. HSBC is one of
India
's leading financial services groups, with over 33,000 employees in its banking,
investment banking and capital markets, asset management, insurance
broking,
two global IT
development
centres
and
six
global resourcing operations in the country. The Bank is t
he founding and a principal member of the HSBC Group which, with
over
10,000 offices in 8
3
countries and territories and assets of US$
2,354
billion at 3
1 December
200
7
, is one of the world's largest banking and financial services organisations.
2.
IL&FS Investsmart Limited (Investsmart)
IL&FS Investsmart Group (
"
IIL
"
) is one of
India
's leading financial services organizations. IIL, through its subsidiaries in
India
and
Singapore
, provides a wide range of investment products to its retail and institutional
clients including equity
and
commodity broking, investment banking, insurance broking
and
distribution, mutual funds distribution and related financing services.
IIL's 2
,
000 employees provide a complete range of investment solutions to over 138,000
customers in India through its 88 branches and 190 franchisee outlets from 133
cities and has been
recognized as "National Best Performing Financial Advisor - Retail" for two years
in a row (06-07
and
07-08)
by CNBC TV 18
.
SIGNATURE
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
HSBC Holdings plc
By:
Name: P A Stafford
Title: Assistant Group Secretary
Date: May 19, 2008