Enticed by an expanding economy and fast rising consumerism, global private equity firms and financial services companies are going all out to increase their presence in India. Firms which have recently made moves to affirm their interest in Asia’s third largest economy include big names such as Lehman Brothers, Baird Private Equity, Apax Partners and Soros Fund Management.
From putting in place a series of high level appointments to oversee Indian operations, to holding strategic meetings aimed at tapping investment opportunities here, the firms have been doing it all.
Late last week, Apax Partners, one of the world’s largest and most well established private equity firms, held a media advisory board meeting in Mumbai aimed at evaluating investment opportunities in the country. The meeting saw seven advisory board members flying in from abroad to interact with potential clients. “The board meeting is a quarterly affair held in different countries. It is being held in India this time as we are excited about the prospects here,” said MD and country head Neeraj Bharadwaj. Apax is currently raising a Euro 8.5-billion fund that will invest in emerging markets, including India.
Last year, in one of the largest power deals, the Tulsi Tanti-promoted Suzlon Energy had bought out Netherlands-based Hansen Transmissions International from private equity firms Allianz Capital and funds advised by Apax Partners, for $565 million. “Our intention is participate with large companies that we believe, have the ability to grow,” said Paul Fitzsimons Chairman of the Apax Exit Committee and member of the Apax Approval and Investment Committees. Apax traditionally invests in sectors such as technology and telecom, media, retail and consumer, healthcare and financial and business services.
Strong global interest in India has seen interest by private equity groups surge over the past few years. A recent survey by international law firm Simmons & Simmons and Societe Generale Corporate & Investment Banking says the industry is set to see continued growth in fund-raising in 2007 with China, Germany, India, and Central and Eastern Europe being key areas.
Private equity funds raised 29% more to invest in emerging markets in 2006 than in the previous year, according to the Emerging Markets Private Equity Association. Capital commitments to Asia, Eastern Europe, Latin America, the Middle East and Africa rose to $33.2bn, up from $25.8bn in 2005, the association said.
In yet another development, the US-based Baird Private Equity, appointed Mr Mohan Kharbanda as executive-in-residence to advise its portfolio companies and for potential expansion opportunities in India. Mr Kharbanda was earlier with Apple, where he led a team for establishing offshore operations in India and Eastern Europe. He was also responsible for launching Dell’s operations in India.
In a statement, Baird said Mr Kharbanda will also serve as a member of the business services advisory board for Baird Capital Partners, the company’s buyout arm. It may be recalled that in February, Baird had announced its partnership with the Bangalore-based Tholons, a corporate advisory firm to provide corporate business processes for its US and European portfolio companies. Baird’s private equity business has raised and managed $1.7bn in assets.
In yet another high level recruitment move, Lehman Brothers, the US-based global investment bank, said it has appointed Prashant Purker as managing director and head of global finance, India. Mr Purker will be responsible for Lehman’s operations in debt, equity and the client-based risk solutions group in India.
Mr Purker’s appointment could be viewed against the background of the growing M&A deals — both within and without India — where demand for innovative structured financial products is increasing. Mr Purker joins Lehman Brothers from ICICI Bank Ltd, where he was head of global principal investments and trading.
Recently, George Soros’s money-management firm, Soros Fund Management, is reported to have appointed Mark Malloch Brown, the former deputy secretary general of the United Nations, as vice chairman to help with investments in emerging markets such as China, India and Malaysia. Mr Malloch Brown will advise chairman George Soros and his deputies, Robert and Jonathan Soros.
Source : Economic Times