After an extremely difficult 2009 where LPs tightened their purse strings following the global equity markets crash, fund raising climate improved significantly in 2010. On the one hand liquidity flooded Indian capital market through foreign institutional investors while on the other, private equity firms with strong India investment theme managed to hit targets more easily than before. Read on to know more about the fund-raising trail, as per data sourced from VCCedge:-
India Dedicated Funds
Peepul Capital LLC
Peepul Capital Fund III: $350 million
Peepul Capital, a Chennai and Hyderabad based private equity firm, raised $350 million for its third fund going in for a single close. The fund raised commitments from institutional investors in the US and Europe. Founded in 2000, Peepul began its operations with a fund size of $110 million and raised its second fund of $214 million in 2005. Peepul Capital usually commits $15 million to $25 million of equity in each transaction, looking at both expansion-stage and restructuring/buyout opportunities. A significant portion of the latest fund may be deployed for buyout opportunities. It partnered with Europe’s largest loyalty programme player Payback Gmbh to buy a majority stake in loyalty card provider i-mint in 2010. Other deals include $13 million in Aqua Designs India Pvt. Ltd. (environmental & facilities services), $10 million in TeleDNA Communications Pvt. Ltd (application software) and $21.5 million in UniverCell Telecommunications India Pvt. Ltd. (computer & electronics retail).
Debut Fund: Final Close At $515 million
CX Partners, a private equity fund headed by former Citigroup Venture Capital Partners head Ajay Relan, made its final close in July this year. The fund raised $295 million after making a first close in 2009 at $220 million in one of the toughest fundraising environments. CX Partners, which became the first in the breed of new independent general partners in India to close their funds, used UBS as the placement agent in their second leg. It has also not wasted time as it closed nearly half a dozen deals this year. CX Partners has invested $25.71 million investment in NTL Electronics India Ltd (electrical components & equipment), an undisclosed amount in Convexity Solutions Pvt. Ltd. (investment banking & brokerage) and $33.74 million in Monnet Ispat & Energy Ltd. (steel manufacturing). More recently, it picked up a stake in diagnostics firm Thyrocare and formed a JV with Delhi-based Imperial Group to co-develop budget hotels.
Indivision India Partners II - First Close At $250 million, Target At $550 million
After breaking away from Future Capital Holdings, private equity firm Everstone Capital made a first close of its second private equity fund Indivision India Partners II at $250 million. The fund is looking to raise up to $550 million for the second growth capital fund after the $425-million Indivision-I raised in 2006. It raised the funds for first close from 15 limited partners from North America and Europe. Indivision India Partners I also exited Lilliput Kidswear Ltd this year in what was the largest secondary deal, with its stake being picked by global PE majors Bain Capital and TPG Growth.
Multiples Alternate Asset Management
Maiden Fund - First Close At $250 million, Target At $450-500 million
Multiples Alternate Asset Management, promoted by former ICICI Venture head Renuka Ramnath, made the first close of the fund at $250 million. The fund is targeting a corpus of $450-500 million for its final close. The fund is among the several to adopt a dual fund structure where it has raised commitments both domestic and international investors. While the domestic portion has been anchored by the India Overseas Bank and Andhra Bank, and the international portion by Canada Pension Plan Investment Board (CPPIB) and CDC, UK. Multiples was the first Indian firm to raise funding CPPIB, which is one of the world’s largest private equity investors, with a $100 million commitment. The fund is sector-agnostic and will make growth investments in Indian companies, management-led buyouts and spin-offs of divisions from large Indian groups.
SIDBI Venture Capital
Second SME Fund: $215 million
SIDBI Venture Capital closed its third venture capital fund mopping up Rs 1,000 crore ($214 million) from domestic financial institutions and banks. The new fund, which is double the size of SIDBI Venture Capital's last fund, was anchored by parent SIDBI which has committed Rs 250-300 crore. The rest of the amount came in as commitments from public sector banks, insurance firms and other financial institutions. The new fund will see SIDBI Venture Capital participating in large growth capital deals along with investments in small and medium enterprises (SME).
International Funds With Major India Focus
Carlyle Asia Partners III: $2.55B
Carlyle Group raised its biggest ever Asia fund closing its Carlyle Asia Partners III at $2.55 billion that doubled its total committed capital in Asia(excluding Japan). Over 40% bigger in size to its predecessor Carlyle Asia Partners II, the new fund will complement Carlyle’s existing investments in firms such as Allsec Technologies, Newgen Imaging Systems, HDFC, Great Offshore besides Claris Lifesciences that just went public. Carlyle also closed four growth capital investments totalling over $140 million in Asia including a deal for an undisclosed sum in Andhra Pradesh-based dairy firm Tirumala Milk Products Private Ltd out of its Carlyle Asia Growth Capital Partners IV in the middle of the year. Tirumala Milk Products, the flagship of Tirumala Dairy, is among the top three private dairy operations in south India growing at a CAGR of nearly 30%.
New Enterprise Associates
Fund XIII: $2.5B
NEA gave the first big positive news for fund raising efforts at the beginnging of the year by closing one of the biggest ever VC funds ever. The firm that targets mid-late stage companies in India, is looking to invest as much as a sixth of the total fund or $375 million in the country. Bala Deshpande, who was roped in from ICICI Venture as NEA’s India head sometime ago, had earlier told VCCircle that the VC firm will look at cutting 3-4 deals with ticket size of $30-80 million in the country every year and is specially eyeing opportunities in services and domestic consumption play.
3i Group plc
Growth Capital Fund: $1.6B
The UK-based private equity major raised by far the biggest sum, part of which to be invested in India. The first growth capital fund from 3i Group raised a quarter of the amount from external investors from Asia, Europe, the Middle East and North America, rest brought in by the PE firm itself. An active investor in the country with exposure in power, clinical research, media among others also manages a $1.2-billion India-dedicated infrastructure fund. The new fund that earlier announced its maiden deal in a European fruit juice producer, aims to invest in 20 mid-market companies, with a typical deal starting from €25 million to as much as €150 million. Some of its key focus areas in the country is expected to be media, healthcare, technology and financial services besides infrastructure.
Fund IV: $1.25B
The Asian private equity firm that primarily chases investment targets in China and India, raised its fourth fund this year. The PE firm scouts for investment opportunities in sectors such as consumer products & services, technology, media, telecom, financial services, healthcare, travel & tourism and manufacturing. It saw a successful listing of travel services firm MakeMyTrip at Nasdaq during the year and is particularly keen on investing in early stage ventures. The firm that makes individual equity investments of $10-100 million, in single or multiple rounds of financing and seeks a large minority stake often ranging upto 40%, will celebrate a decade of its existence in the coming year.
Navis Capital Partners
Navis Asia Fund VI: $1.2B
The private equity firm that invests in growth-oriented buyouts in South and Southeast Asia raised its sixth fund, its biggest ever. Although the PE firm had to cut down the original target size of $1.75 billion by little less than half due to the onset of the global financial crisis that made fund raising a challenge, at the final count it exceeded its revised target of $1 bilion fund by 20%. While 60% of the new fund will chase deals in Southeast Asian targets, the rest or just about half a billion dollars will be invested in markets such as Australia, India and Greater China. The firm that is looking at average ticket size of investments in the $50-100 million range has previous India exposure with India Hospitality Corporation (IHC), Nirula's and Mars Restaurant (exited with ale to IHC in 2007), tertiary and executive education service provider ITM Trust and BSE-listed lubricants manufacturer Sah Petroleums.