VC Hunt, the Gurgaon-based SME-focussed venture capital arm of Acumen Capital, has made its debut investment in the hospitality space.
The firm is learnt to have invested about Rs 32 crore, from its Special Opportunity Fund, to acquire 27% in a hotel chain with presence in Kerala and Goa. The name of the hotel chain could not be ascertained yet.
VC Hunt completed fundraising of its Special Opportunity Fund I in July this year with a corpus of $100 million. The firm eyes investments in projects which are languishing due to lack of funding across various sectors.
The hotel chain, which will be operational by December 2010, is run by a joint venture company, where 50% is owned by a renowned global hotel operator while the remaining stake is owned by its Indian partner. The foreign company has presence in about seven countries. The Kerala-based hotel will have about 128-130 rooms while the Goa-based one will have about 135 rooms. Both the hotels will be four-star assets.
Gautam Seengal, Managing Partner, VC Hunt, told VCCircle, “There is good potential in the Indian hospitality industry. As India is a hot destination for both tourism as well as business, there is a continuous flow of visitors, which keeps the hotel industry a better destination for investments.” Seengal is also the Managing Partner for private equity fund Acumen Capital, which has invested in VC Hunt.
The VC Hunt Special Opportunity Fund eyes a typical $7-10 million investment per deal. Once the first fund is completely deployed, VC Hunt is likely to raise another $250-million Special Opportunity Fund II. “As we have tied up with only one single global fund, fundraising is not a concern for us,” Seengal added.
According to VCCedge data, Indian hospitality industry witnessed 64 deals worth $1.34 billion since 2000. In 2010, five deals worth $357 million took place till date, with major investments such as $200 million investment in Coffee Day Resorts by KKR, NSR and Standard Chartered PE, and Xander Real Estate Partners’ $110 million in the hospitality division of Pune-based Panchshil Realty Pvt. Ltd.