Asset management firm Guggenheim Partners has had a busy 2009 in India. Guggenheim, which acquired the India-focused private equity fund of funds business of Thomas Weisel Partners in 2008, has completed several transactions worth $75 million in India.
These deals include new commitments to PE funds and a mix of secondary transactions, said a source familiar with the development.
Guggenheim has invested $25 million across three new funds which are on the road with their new vehicles. A large chunk of this commitment has gone to Ascent India Fund III, which is currently raising a $400-450 million fund. The fund will be managed by Ascent Capital Advisors, led by Bangalore-based UTI Ventures CEO Raja Kumar.
Guggenheim also invested $50 million across both direct and indirect secondary deals. VCCircle could not ascertain the details about these investments.In direct deals, Guggenheim bought out the stake held by general partners (or PE firms) in some of their portfolio companies. These investments help private equity fund managers get liquidity as their fund approaches maturity or they are looking to raise a new fund. In indirect secondaries, the firm bought out the stake held by limited partners (LPs, who are investors in PE) various PE funds. These help limited partners get liquidity before the PE funds complete their investments to exit cycle, which could take between 8-10 years.
The market for secondaries is still nascent in India but is expected to open up as the Indian PE ecosystem matures. A record number of PE investments were made in India between 2007 and 2008. PE firms invested $15.6 billion in 2007 and $11.9 billion in 2008 in India, according to VCCEdge, the financial research platform of VCCircle.
Some of these investments could come to market and provide secondary players an interesting opportunities.
After the deal to acquire India business of Thomas Weisel, Guggenheim also took over as the general partner of Thomas Weisel India Opportunity Fund. This fund-of-funds has invested in PE firms like IDFC Private Equity and Peepul Capital. Guggenheim’s management team is led by K.V. Dhillon (India head) and Anand Sunderji (head of private equity).
Guggenheim is one of the largest asset managers in the world with assets under management of more than $100 billion. It offers services like asset management, investment advisory, capital markets, institutional finance, and merchant banking.