CNBC-TV18 has learnt that L&T Finance is in advanced talks with HSBC to sell its mutual fund (MF) arm.

L&T Finance MF sale has been pending for a while now. It is understood that both the parties have signed an exclusivity period for these deal talks to fructify.

Earlier it was reported that a private equity firm Blackstone, was in the final stages of finalising this particular transaction, they had offered Rs 3,200 crore but it was also stated that it required an important and crucial Securities and Exchange Board of India (SEBI) approval for this deal to go ahead.

The problem was that the SEBI in the past has not been in favour of PE firms with their short-term nature of sponsored funds to invest in the AMC, MF business in the country and Blackstone’s pitch-point was that they are already a sponsor of listed REITs, so therefore they can be extended to MFs as well.

SEBI is also working on a discussion paper for the framework of the PE investment in MF. So, since this delay in crucial approval is still pending, L&T Finance Holdings is in talks with HSBC.

Watch accompanying video of CNBC-TV18’s Nisha Poddar for more details.

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(Edited by : Dipika Ghosh)