TVS Capital raises over Rs 500cr for top-up fund; Beefs up team

Chennai-based private equity firm TVS Capital Funds Ltd, which manages TVS Shriram Growth Fund-IA, has raised commitments of over Rs 500 crore for its top-up fund with backing from large family offices. TVS Capital launched TVS Shriram Growth Fund-IB last year and expects to make a final close at Rs 550-600 crore in the next 30-45 days, according to Gopal Srinivasan.

TVS Capital's chairman and managing director Srinivasan said that TVS Shriram Growth Fund-IB has crossed Rs 500 crore in terms of commitments. The fund has mostly been raised from family offices, whose commitments have ranged from Rs 15 crore to Rs 50 crore.

Sponsors -- TVS Group and Shriram Group -- have committed around Rs 65 crore. Family offices have chipped in Rs 200 crore, institutions around Rs 70-75 crore and the rest came from ultra high net worth individuals (UHNWIs).

TVS Capital made the first close of its top-up fund at Rs 375 crore earlier this year and all the funds have been raised from domestic investors. TVS Capital raised its maiden fund (TVS Shriram Growth Fund-1A) of Rs 500 crore in July 2008 and later added another Rs 100 crore. It was one of the first PE funds to be raised completely from domestic investors.

Boosts team

With the second fund approaching final close, TVS Capital has also beefed up its advisory team and added new executives to the team.

TVS Capital, which is focused on the domestic consumption market, has roped in former Manipal Global Education CEO Anand Sudarshan and former Yum! Restaurants (which operates KFC and Pizza Hut) MD Sandeep Kohli as fund advisors or venture partners. The addition of Kohli, who has worked at Yum! for 11 years, will give a boost to TVS Capital's

investments in Indian Cookery Pvt Ltd and Om Pizzas & Eats Pvt Ltd, while Sudarshan is expected to help the fund chase opportunities in the education space.

TVS Capital has also roped in former Dabur CFO S. Raghunathan, who will work with its portfolio companies, as executive director and COO.

KPMG Corporate Finance's Shyamal Lahon has joined the team as an associate.

It has also appointed B. Soundararajan, founder and chairman of

India’s largest poultry enterprise Suguna Foods, on its fund advisory board. According to its statement, Soundararajan will help TVS Capital in "investing in emerging India opportunities."

Deal making

TVS Capital has had a busy 2012 as well, with three new investments in Development Credit Bank Ltd, Dunar Foods and most recently, in ReGenPowertech. The firm is also nearing closure of another deal and has afew other transactions in the pipeline. It is also looking at a coupleof more exits.

Earlier this year, TVS Capital recorded its maiden exit by selling its stake in third-party logistics service provider TVS Logistics

Services, where it made 2.23x cash-on-cash returns or an internal rate of return (IRR) of 22.23 per cent. The fund sold its stake to private equity major Kohlberg Kravis Roberts & Co. L.P. (KKR) which, along with existing investor Goldman Sachs, led a Rs 268 crore ($53 million) round in the firm.

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