Red Fort Capital, a private equity fund focused on real estate development, is in advance stages of negotiations with six developers for an equal number of projects worth Rs 4,000 crore in the metros across India. The PE fund today joined hands with Godrej Properties to develop an IT park in Kolkata, where Red Fort Capital has picked up 49 per cent stake. The project, Godrej Genesis, is expected to generate sales of over Rs 750 crore. "We are in the process of closing a number of transactions in the NCR, Mumbai and Bangalore. We are currently talking to six different developers in these cities," Red Fort Capital Director Kuldip Chawlla told PTI. Without divulging names of the possible builders, he said three of them are 'big national developers', while the rest are local players.   more »

Ajay Relan, for long the managing director and India head of Citi Venture Capital International (CVCI), the private equity business spun off from Citigroup Inc., has been bitten by the “entrepreneurial bug”. In his first media interview to Mint after stepping down from CVCI last fortnight, Relan discusses the new fund — of between $500-$750 million — that he is going to start, and why he is happy that it comes at a time when stocks at the Bombay Stock Exchange are not at near-25,000 levels.   more »

Accel Partners, a leading venture capital firm operating in Silicon Valley, Europe, Israel and China, today announced the formation of Accel India Venture Fund. The latest element in Accel’s global strategy, Accel India Venture will focus on early-stage venture investing, delivering active, hands-on strategic and operational guidance in partnership with India’s most promising entrepreneurs. Accel India Venture Fund will be managed by four experienced partners who currently are the Partners of Erasmic Venture Fund (EVF). EVF is one of the leading seed and early-stage investment groups in India, with a portfolio including Mu Sigma, Inbiopro, HolidayIQ, Kaati Zone, Myntra, Sconce, Virident and many other exciting new ventures. Subrata Mitra, Prashanth Prakash, Mahendran Balachandran and Gagan Kumar bring deep entrepreneurial and operational expertise as well as a strong track record of helping entrepreneurs to develop successful new businesses in India. All four individuals will be joining Accel as the Partners of Accel India Venture Fund.Accel India Venture Fund will seek to work with India’s best entrepreneurs from the very earliest stages of the new venture creation process.   more »

Milestone Capital Advisors, the real estate venture capital fund promoted by Ved Prakash Arya, is planning to launch a private equity fund with a corpus close to Rs 600 crore. The announcement will be made in a few weeks. The PE fund, the first from Milestone's stable, will focus on sectors such as education and infrastructure. "Right now, I am bullish on these two sectors as there is lot of scope for companies to expand and reach a mass base," said Ved Prakash Arya, managing director, Milestone Capital Advisors. Its fourth real estate fund — Milestone Domestic Fund Part-II — has raised Rs 430 crore and will close shortly. The fund house is proposing to raise Rs 500 crore from this fund. Despite the rough market weather, the fund house's track record and investment strategy have helped in getting investor commitments, Arya said. Realty funds have been finding it difficult to raise funds from high networth individuals (HNIs) and institutions owing to a credit crisis in the US, the impact of which has been felt in India as well.   more »

With the economy slowing down Indian players are looking at setting up distressed funds. Edelweiss Alternate Asset Advisors (EAAA), an arm of Edelweiss Capital is looking at launching a $200-million distressed asset fund. Other players, who already have an ARC licence, are also looking at setting up these funds. Till now, only foreign funds have been active players in this market. Siby Antony, executive VP and head-distress investments, EAAA told ET: “We propose to put in a vehicle over the next 6-9 months. We should have everything in place by December. We are not looking at retail NPAs, but SMEs and large corporates. We hope to create value in potentially viable units,” he adds. EAAA is initially looking at $200 million fund which could go up to $400 million depending on investor demand. Edelweiss is in the process of applying to the Reserve Bank of India for an asset reconstruction company (ARC) licence. Mr Antony said initially they would go with a single asset and once ARC is approved, they would go for portfolios. Others, who are in the market to raise funds, include Vision Global which has launched a $200-million fund.   more »

Intel Capital, the venture capital unit of Nasdaq-listed Intel Corporation, on Thursday said it will invest US$17 million in three Indian companies and said it is bullish on the country's investment prospects. The three companies identified for investment are online travel portal Yatra.com, event-oriented social network BuzzInTown.com and advertising company Emnet Samsara Media. "We are rapidly investing in opportunities that we find suitable and are excited about investment prospects in the country," Intel Capital President Arvind Sodhani said. The funding for the said investment would come from the US$250 million Intel Capital India Technology Fund. The fund has already invested US$125 million so far in the country, Sodhani said, adding that apart from investing in technology companies, the fund would also focus on alternate sources of energy.   more »

CDC Group, the UK government-backed private equity emerging markets fund of funds investor, has announced that it has made new commitments totaling $185m to six private equity funds focused on investment in India taking its total commitment to over $1 billion. It is expected that these funds will raise a total of over $2.47bn for investment in the region. CDC's latest commitments include $50m to Baring India Private Equity Fund III, $50m to New Silk Route Private Equity Asia Fund, $25m to India Value Fund III, $20m to BTS India Private Equity Fund, $20m to Avigo SME Fund II and another $20m to VentureEast Proactive Fund. A statement from CDC said private equity firms invested $17bn in India in 2007, more than double the amount invested in 2006 of $7.4bn. However, the majority of these deals remain later stage where more mature companies are attracting expansion or pre- IPO financing with a relatively small amount being invested in early stage deals.   more »

Donald Trump Jr, whose father built a multibillion dollar fortune in real estate, plans to set up a fund of as much as $1 billion to buy property in India, betting on the nation's growing wealth. "Trump may create the privately held fund with investors including an Indian family," he said. He didn't give specifics on how he'll raise the money, or when the first investment will be made. Trump would join Deutsche Bank AG and Lehman Brothers Holdings Inc in amassing funds to invest in a market that recorded the world's highest growth in millionaires last year, fueling demand for luxury homes. The highest borrowing costs since 2002 have ended India's five-year property boom, curbing valuations of projects and developers. "The real estate market is in a downturn now," said Ritesh Vohra, director of investments at Mumbai-based Saffron Asset Advisors, which manages more than $400 million in two property funds. "There's some more pain left over the next two years or so, and that could be an opportunity to invest."   more »

LIC Housing Finance, the mortgage arm of Life Insurance Corporation of India (LIC), is set to foray into the venture capital arena and intends to start a Rs 500 crore real estate fund by the end of this financial year. LIC Housing Finance is reportedly scouting for a banking partner for raising capital and will soon approach the Securities and Exchange Board of India (Sebi) to set up an asset management company. To invest in listed companies, companies usually register with Sebi. “This is an opportune time to enter, considering the demand. We will form a separate asset management company to manage this fund,” a senior LIC Housing Finance executive told Business Standard. Based on the response to the real estate fund, the company will decide on whether it will expand its presence in the venture capital space.   more »

Canara Bank, India's second largest public sector bank, is all set for an aggressive play in the venture capital business. The bank has sought the Securities and Exchange Board of India (Sebi) approval for a venture capital fund. The fund will not be sector specific. The fund will be the largest one (Rs 500 crore) from the bank, which floated a venture capital subsidiary way back in 1989. The VC arm has so far floated four funds, the total corpus of which is Rs 112 crore and has invested in around 80 companies. Senior officials of the bank confirmed that they have sought approvals from the regulatory body, after which they will be hard-selling this product to other government-owned institutions for participation. Allahabad Bank, Corporation Bank, Indian Overseas Bank, Oriental Bank of Commerce, Vijaya Bank, Andhra Bank and Small Industries Development Bank of India have earlier participated as investors in its earlier fund, the corpus of which was around Rs 60 crore.   more »