Bala Naidu quits Baring PE Asia; floats $600 mn multi-asset investment firm

Baring Private Equity Asia managing director Lakshmiah Balachandra Naidu has quit the firm to set up an Asia-focussed multiple asset class investment platform, a person briefed on the development told VCCircle.

Bala Naidu has also registered a Singapore-based entity Argha Capital that aims to raise a total corpus of $500 million to $600 million, the person said, asking not to be named. The new firm is targeting its first close at around $200 million in mid-2017, he added.

Baring PE Asia did not respond to a request for comment. Naidu confirmed his exit from Barings PE Asia but declined to specify or confirm other details.

The person cited above also said that Naidu’s new fund will invest half its corpus in India and the remaining in Southeast Asia, where it will focus on opportunistic equity investments.

In India, the new fund will follow a three-pronged approach. Around $100 million will be for structured debt deals while $50-100 million will be for opportunistic equity investments including special situations.

These investments will be made through a Category II alternative investment fund, which is yet to be registered with the capital markets regulator Securities and Exchange Board of India.   

Naidu also intends to sponsor a consumer finance non-banking financial company (NBFC) with a capital base of $100 million, the person cited above said.

The Mint newspaper first reported Naidu’s exit from Baring but it said that he was looking at a $200 million investment firm straddling NBFC and structured debt financing deals

NBFC, pan-Asia focus

Naidu joins a host of industry veterans who have floated NBFCs. In October, for instance, KKR India chief Sanjay Nayar and former Citibank executive Vikram Sud started an NBFC

Naidu is understood to have roped in a few industry veterans for his NBFC. The NBFC is yet to be named and is likely to be launched early next year. The NBFC may focus on home loans and commercial vehicles financing and will use technology, especially in analysing risk profiles, to drive lending activity, a person briefed on this strategy said.

Naidu is among a growing number of PE professionals who have floated their own pan-Asia investment platforms with India as a key focus market. These include Amit Varma of Quadria Capital and Brahmal Vasudevan of Creador Advisors.

Varma, who founded Quadria Capital in 2012along with Abrar Mir, last year closed his maiden fund focussed on the healthcare sector in Asia .

Former ChrysCapital managing director Brahmal Vasudevan’s Creador Advisors is raising its third pan-Asia fund.

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