RSS FeedJP Morgan To Set Up $2B Infrastructure Fund; Tata Realty Plans $750M
Tue, 10/30/2007 - 11:32 — Sahad P V
JPMorgan & Chase Co., the third largest US bank, has set up a $2 billion fund to invest in Indian infrastructure projects such as roads, ports and power, reports Bloomberg. The fund will be ready to invest in companies and projects by the end of this year, the report says quoting Anil Bhalla, managing director of the Asian Clients Group at J.P. Morgan Securities Inc.
Meanwhile, Tata Realty & Infrastructure, a wholly owned subsidiary of Tata Sons, has also announced that it's launching a $750 million infrastructure fund. The fund, which will attract investment from insurance companies, pension funds, government entities and endowment funds, is expected to close in a fortnight (see a report in Business Standard.)
JPMorgan and Tata Realty join many others like 3i, Blackstone Group, Citigroup Inc. and ICICI Bank who have / are forming multi-billion dollar infrastructure funds in India. Blackstone, Citigroup and two Indian companies in February announced a plan to set up $5 billion fund for investing in Indian infrastructure projects. Private equity group 3i and the government-owned India Infrastructure Finance have announced a $1 billion infrastructure fund for India. The fund has so far raised $500 million, of which it has committed $227 million for an 8 per cent stake in Adani Power of Gujarat.
ICICI Bank, India's largest private esector bank, has also said that it's floating a $2 billion infrastructure fund.
Bahrain's Gulf Finance House has also raised $630 million for an Energy City India, an infrastructure project to be set up in Maharashtra. This issue was oversubscribed 60 per cent over the targeted sum.
The country's finance minister P Chidambaram said on Monday that India needs $488 billion over the next five years for investing in infrastructure alone. India currently spends about 5 percent of its $906 billion GDP, but that needs to grow to 9 per cent, according to Chidambaram.
[Picture: the toll gate at Delhi-Noida-Delhi flyway, promoted by Infrastructure Leasing and Financial Services Ltd (IL&FS) and New Okhla Industrial Development Authority (NOIDA)]
Comments
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It is really heartening to
Abhishek Gupta, November 04, 2007It is really heartening to note the PE funds getting interested in Infrastructure sector in India. This sector is crucial for the growth of the over all economy and poised to do well in backdrop of high GDP. However still the funds are looking at 25 + Mn USD tickets size deals for various reasons. Based on my experience in PE business for past couple of years, I think if Funds also consider the deal sizes in range of 5-8 Mn USD, they could find a good no of promising stories.
Rgs.