Private equity firm Helix Investments has picked up a significant minority stake in thermal engineering company , officials told
VCCircle. The Pune-based firm, set up by first generation entrepreneur K. Vijay Kartha, provides energy efficiency and waste heat recovery solutions.
The deal size was not disclosed though David Danziger, Director of Helix Investments, said that the investment firm is willing to put more capital in M.E Energy if needed. Corporate Finance Associates (CFA) India, was the exclusive financial advisor to ME Energy for thistransaction.
The funds will be used by M.E Energy to expand its manufacturing capacity, marketing network and chase larger value contracts in the industry. Kartha told VCCircle that the company plans to reach revenues of Rs 250 crore to Rs 300 crore in the next 2-3 years.
“We serve the needs of both new and existing industrial and power plants. There is a large potential market for our solutions and it is growing rapidly. By partnering with Helix, we will be able to expand our capacity and geographical presence enabling us to cater to a larger share of this growing market,” said Kartha.
M.E Energy provides its services to a wide range of industries for process heating/cooling and secondary power generation right from manufacturing, designing to installation. It manufactures related products including hot air and hot water generators, heat exchangers, and pressure vessels. M.E Energy’s customer base includes Britannia, Deepak Fertilizers, Andhra Petrochemicals, Wartsila, VVF, Ford Motors, Linde Engineering etc.
“With increasing cost of fuel, WHR (waste heat recovery) solutions will become even more viable across industries thereby expanding the adoption rate and the market size significantly. We are enthusiastic to put more capital to work in M.E Energy, should it be needed,” said Danziger.
Sumit Tayal, Director of Helix Investments Advisors, says that M.E Energy takes the heat, which is getting wasted, to be recycled either as electricity or help reduce heat consumption for other processes in the plant. “There are very fewplayers in this market with an established capability to offer a wide variety of customised solutions," said Tayal.
Helix estimates the size of energy efficiency and waste heat recovery market in India to be over Rs 1,000 crore and as one of the fastest growing in the thermal engineering space. M.E Energy competes with the likes of Thermax and Sita Boilers in its segment. Another investment in this segment was in 2009, when Siemens Venture Capital acquired stake in Transparent Energy Systems.
M.E Energy will be the second investment in the industrial sector for Helix Investments, a $100 million fund sponsored by the Cullman and Bloomingdale families from the US. Helix has previously invested in Gujarat-based power electronics player Hi-Rel Electronics Pvt. Ltd.
Helix typically invests between $5-20 million per transaction in
sectors like consumer goods, business services including IT and ITeS, industrials and education. Its current portfolio includes Mahesh Tutorials, a BSE-listed school tutoring company, and LearningMate, a leading provider of e-learning solutions. Helix had also invested in medical transcription outsourcing firm OSi and Calorie Care, which provides customised, calorie-counted meals.
(Edited by Prem Udayabhanu)