Creador part-exits Cholamandalam Investment

Creador, a private equity firm focused on South and Southeast Asia, has part-exited its four-year-old investment in Murugappa Group’s non-banking finance company Cholamandalam Investment & Finance Co Ltd by selling about a third of its stake.

The PE firm has divested a stake of about 1.5 per cent for around Rs 140-150 crore ($22 million), earning about four times in gross returns in local currency terms, last quarter. The returns in dollar terms have been lower but fairly above average, making three times the original investment value, as per VCCircle estimates.

In a response to an emailed query, Creador founder and CEO Brahmal Vasudevan confirmed the development to VCCircle and said the firm is still holding shares of the company as it sees huge potential.

As on September 30, the company held a 4.25 per cent stake in the Chennai-based NBFC, data available with the stock exchanges showed. This has shrunk to 2.7 per cent.

Creador Capital and Multiples Alternate Asset Management had invested around Rs 106 crore each in Cholamandalam Investment in early 2012. Multiples PE exited the company by selling its entire stake around a year ago.

Cholamandalam primarily focuses in the rural and semi-urban sector with 90 per cent presence across tier III and tier IV towns. Other investors in Cholamandalam include Norwest Venture Partners, IFC, Apax Partners and WestBridge.

For Creador, founded in 2011 by Vasudevan, a former general partner and managing director at ChrysCapital, this is the second exit-related activity.

The PE firm completed its debut exit from an Indian portfolio firm by selling its entire stake last year in housing finance company Repco Home Finance Ltd with a multi-bagger over a horizon of almost seven years.

Some of its other investments include Ashiana Housing, PC Jeweller, Somany Ceramics and Vectus Industries.

Apart from India, Creador has presence in countries including Indonesia, Malaysia and Singapore. Some of its significant portfolio firms outside India include Indonesian cereal and snacks maker Simba Indosnack Makmur and multi-finance company BFI Finance, Malaysian fashion brand Bonia Group, Southeast Asian payment solutions provider GHL Systems Berhad and Indonesian lender Bank Index Selindo.

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