Multiples Alternate Asset Management, a private equity firm floated by former ICICI Venture CEO Renuka Ramnath, has closed its debut transaction by picking up a significant minority stake in Dehradun-based Sara Sae Pvt Ltd, which manufactures hi-tech drilling equipment for land and jack-up rigs. The funds raised from Multiples Private Equity Fund will be used to finance the buyout of 76 per cent stake, held by NYSE-listed National Oilwell Varco in Sara Sae, and also to fund its growth plans.
US-based National Oilwell Varco had picked up 76 per cent stake in Sara Sae for approximately $26 million in 2007.
Sara Sae (formerly called NOV Sara), founded by first-generation entrepreneur V. K. Dhawan in 1979.
The funding will enable the promoters of Sara Sae to enter the oil field equipment services business and expand into other high potential product lines, according to a statement.
Avendus Capital was the financial advisor to Sara Sae and its promoters.
Sara Sae manufactures hi-tech drilling equipment for land and jack-up rigs like BOP accumulators, hydraulic tongs, hammer unions and swivel joints. It has manufacturing facilities at Dehradun and Faridabad and a sales-cum-warehouse setup in Houston, USA. Exports account for more than 85 per cent of the turnover.
“We are very excited about the growth opportunities provided by this transaction. The Multiples teams’ partnership approach, along with proactive growth focus, will provide the necessary impetus for Sara, which is well-poised for strong growth in both its business segments – BOP Control systems and the fast-moving oilfield consumables,” said V.K. Dhawan, co-promoter and chairman of Sara.
“Sara fits in completely with Multiples’ investment philosophy of backing proven entrepreneurs with products and services, which can match the best global standards,” said Renuka Ramnath, CEO of Multiples, which had recently raised $450 million from international and local investors.
While Multiples, along with a consortium, had agreed to invest in Thrissur-based Dhanlaxmi Bank, that deal waslater called off, making Sara Sae its maiden deal.
Multiples is a sector-agnostic fund, looking to invest $15-$50 million in high growth, mid-sized Indian companies and management-led buyouts/spin-offs. When Ramnath was at the helm of ICICI Venture, the PE firm had backed the management in buying out stake from foreign promoters in companies like VA Tech Wabag.