Singapore-based Nalanda Capital, which invests in listed Indian companies, has increased its holding in mid-sized IT services firm MindTree by 1.7% to 8.4% through open market transactions.
It bought the additional stake on Tuesday for Rs 35 crore ($8 million) taking its overall investment till date to over Rs 157 crore ($35 million), at an average acquisition price of Rs 469/share. This stake is valued at Rs 170 crore at present. Given that the fund house is putting in more money at higher price, it appears to be going long on this investment.
Nalanda initially bought into MindTree in February last year, buying close to 2% stake from venture capital firm Walden International (a pre-IPO investor who is gradually diluting its holding) at a low price of Rs 212 per share. Since then, it has been hiking stake in MindTree. Last December it had acquired a chunk of shares from Walden at Rs 686/share. In a way, it is also trying to average out the cost of previous transaction.
Walden currently holds around 10% stake in MindTree that also has the backing of names like Government of Singapore (believed to be through an investment arm) and Global Technology Ventures.
Nalanda, a $400-million fund headed by former Warburg Pincus India MD Pulak Prasad, has been one of the most active PE investors picking small minority stakes in Indian listed companies. It also invested in Aztecsoft which was acquired by MindTree in one of the biggest deals in domestic IT space. During the downturn, Nalanda picked up stakes in over half a dozen listed companies such as Mindtree, Mastek, Triveni Engineering, Page Industries etc. Its other investments include Vaibhav Gems and WNS.
Early this year, Nalanda had exited Chennai-based broadcaster Sun TV Network Ltd with 2.5x returns on its 14-month- old investment in Kalanithi Maran-owned Sun TV. Nalanda picked up a 2.22% stake in Sun TV back in December 2008.