Singapore-based private lender United Overseas Bank Ltd (UOB) is buying 50 per cent stake in India-based venture debt firm InnoVen Capital (formerly SVB India Finance) as part of a larger game plan to expand the geographic focus of the early-stage investor to rest of Asia.
InnoVen Capital was earlier a part of Silicon Valley Bank, a wholly-owned subsidiary of SVB Financial Group.
Singapore government owned investment firm Temasek acquired it for around $48 million in April and renamed it as InnoVen Capital, a deal which also marked its foray into venture debt business. Temasek also has a separate venture capital investment arm Vertex besides its lending business through Fullerton.
As part of the latest agreement, UOB will purchase a 50 per cent stake in InnoVen Capital for an undisclosed amount. Both the companies will commit up to $100 million each to the paid up capital of InnoVen Capital. They expect to scale up the business and offer up to $500 million in venture debt over the next five years.
InnoVen Capital will establish subsidiaries in Singapore and China in the coming months to offer venture debt to fast-growing innovative companies in these markets.
The platform which will be based out of Singapore will be called InnoVen Capital Singapore and will be headed by Ajay Hattangdi, CEO and managing director at InnoVen Capital. He is currently looking at setting up a team to evaluate lending opportunities through this platform. InnoVen Capital India, the India-focused lending platform under InnoVen Capital, currently has a loan book of more than $50 million.
InnoVen will offer loans to startups in sectors including technology, consumer, healthcare and clean technology.
Emails sent to UOB spokespersons for more details on the transaction did not elicit a response.
In a statement, Eric Tham, managing director and head of commercial banking at UOB Group, said: “Venture debt is important as it enables more of Asia’s best startups to develop into world-class companies. We can see this in China and India which have vibrant startup ecosystems, while Singapore is establishing itself as the startup hub of Southeast Asia.”
“This new pan-Asian venture debt financing initiative will seek the next generation of leading companies, providing the support they need to scale and succeed,” said Ong Beng Teck, managing director, enterprise development group, Temasek Holdings.