August 2007
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India private equity not scared of global credit crunch

Private equity's appetite for India's fast-growing economy has not been spoiled by the global credit crunch and investment is expected to stay on track to rise by a third to $10 billion this year, with fewer but larger deals. Blackstone Group has struck two deals in India totalling $315 million in just over a week, while 3i Group is setting up a $1 billion India infrastructure fund and ChrysCapital has a new $1.25 billion cross-sector India fund. Blackstone has said it has a “huge pipeline” of deals in India and was targeting deals in the $50-$500 million range, even as the U.S. and European credit markets remained frozen. Private equity firms and takeover advisers in India say Blackstone and others are right in going ahead with plans. “A lot of money has been raised by India-specific funds recently, and that money has to find a home here,” said Rishi Sahai, director, IndusView Advisors Pvt Ltd. […]

ADB`s Carbon Fund eyes projects in India

Asia Pacific Carbon Fund, managed by Asian Development Bank, is scouting for renewable energy and energy efficient projects in India to provide co-financing and technical support. The fund which recently (in early August) raised $151.8 million from investors, including those from Europe, has a mandate to finance Clean Development Mechanism (CDM) projects in any of ADB’s 44 developing member countries. “The Carbon Fund team is speaking with a number of project proponents in India in a number of states involving a range of CDM projects in various sectors,” a ADB official said. India was a priority for the fund due to its size and potential as well as the government’s commitment to foster clean energy in the country, the official said. […]

Yes Bank to spin off PE syndication, M&A business

Bank to spin off investment banking into wholly owned subsidiary. Yes Bank has decided to spin off its investment banking division into a wholly owned subsidiary. The move is aimed at reflecting the robust growth achieved by the division in clinching deals in private equity syndication, mergers & acquisitions (M&A) and initial public offerings (IPOs). The bank is also planning to foray into institutional broking, and other related businesses under the new subsidiary. Managing Director of the Investment Banking Group of the bank. Aditya Sanghi said that the division, which was ranked number one in M&A ‘outbound cross border transactions’ and number five in M&A ‘overall’ category last year by Bloomberg, also managed to stay in the top five for ‘cross border M&A’ and top 10 in ‘overall’ M&A this year. The bank is backed by Rabobank, Citigroup and other international investors. […]

DFJ to set up shop in B’lore, readies $75m

Silicon Valley’s leading venture capital firm Draper Fisher Jurvetson (DFJ) is finally setting up its shop in India. The early stage technology-focused VC is opening its Bangalore office in September with also a presence in Hyderabad. DFJ has kept aside $75 million of its recently raised $600-million DFJ IX fund for India. DFJ managing director Don Wood told ET that Mohanjit Jolly, a partner with the firm, will be moving to Bangalore next month. “DFJ will be investing in India directly out of our DFJ IX fund that we recently raised. In addition, we plan to partner with an existing fund in India to join our DFJ global network, which is now comprised of over 20 funds. We hope to find our new partner for India this year.’’ The DFJ offices in India will have Mr Jolly and venture partner Sateesh Andra in Hyderabad. The plan is to add to the staff at analyst and/or associate levels. DFJ is not new to India and has made several investments here. Past investments include $2 million in online DVD rental company Seventymm, Komli, and $20 million in electric car maker Reva. According to Mr Jolly, the firm is currently in the final stages of two investments in India out of IX.(ET) […]

BCCL acquires stake in Travel Masti

Bennett, Coleman & Co Ltd (BCCL) has acquired a stake in Travel Masti Holidays Private Ltd, a company which provides internet-based travel related services to domestic and inbound tourists and corporates for their conferences. The portal,, offers hotel reservations and information on various hotels and resorts and is in the process of expanding into other premium services, such as hotel representation services and travel agency transactions business. According to Travel Masti Holidays COO Manan Aggarwal, “BCCL and Travel Masti are a perfect fit for each other. BCCL’s presence as shareholders will bring in tremendous value and help Travel Masti in it’s quest to take it’s business to the next level. Our association with BCCL has come at the right time and would prove to be an important milestone in the life of our company.” The current business mix comprises domestic clients (60%), inbound clients (25%) and corporate conference clients (15%). (ET) […]

HDFC raised $800 million for a real estate fund

Housing Development Finance, India's second-largest mortgage company, said it raised $800 million from overseas investors for a real estate fund to tap the nation's growing demand for homes and offices. The Mumbai-based company is seeking a 20 percent to 25 percent return for the nine-year fund, it said in a statement. The firm said its knowledge of the Indian market gives it a competitive advantage. “The fund will have a conservative approach with no regional or sector bias” and will invest in the residential, commercial, hospitality, education and health care sectors, as well as in developers, said the chairwoman of HDFC Property Ventures, Renu Sud Karnad. India's real estate development market may increase more than sevenfold to $90 billion by 2015 from $12 billion in 2005, Moody's Investors Service said in June. Funds of global investment banks such as Morgan Stanley and Deutsche Bank are investing in Indian real estate as an economy that has grown at 8.6 percent for the past four years drives demand for property. “The returns that numerous investments have generated in recent years have caught the attention of the investor community,” HDFC said.( IHT) […]

Apollo Health acquires Atlanta BPO for $170 m

Apollo Health Street (AHS), the BPO arm of Apollo Group of Hospitals, has acquired Zavata, an Atlanta-based BPO which operates in the same segment, for $170 million. This synergistic acquisition is not only expected to strengthen AHS’ presence in the US market, but is also going to bring in specialised skill-sets, adding value to the company’s existing portfolio. Apollo Hospitals group executive chairman Prathap C Reddy told mediapersons in Chennai on Thursday that “this acquisition will make Apollo Health Street the largest global healthcare BPO company”. The acquisition is to be funded through a combination of debt and equity, broken into $120 million of debt and $50 million equity. Barclays Capital and Bank of India, the funding agencies for the acquisition, have offered an optional draw-out of $140 million (including $8 million refinancing portion of an earlier debt) to the company, including the debt component of this deal. The balance funding will come through internal accruals, Pratap Reddy said. Of $50 million equity, the Apollo Group will invest $25 million while private equity investors — JP Morgan’s investment arm One Equity Partners and Temasek Holdings — will fund the rest. […]

Sun TV unit picks up 49% stake in Red FM

In a strategic move to become a pan-India player in the FM radio segment, Sun TV Network, through its subsidiary South Asia FM Ltd (SAFL) has acquired 48.9% stake in Red FM, promoted by NDTV along with individuals like Usha Reddy and Arjun Rao. In return (on a swap ratio basis), the Red FM promoters together picked up 35% stake of the enlarged equity of SAFL. As part of the transaction, SAFL has picked up stake in Red FM by acquiring equity of the holding companies of the latter at par. The promoters of Red FM will continue to hold 51.1%. […]

IFC to invest $12 mn in Owens Corning

International Finance Corporation today said it will invest 12 million dollars as equity in fibre glass maker Owens Corning (India) to help it expand its manufacturing facility in Maharashtra. The expansion of glass melter and related downstream equipment capacity by Owens Corning will result in significant energy and efficiency improvements, IFC said in a release. With Owens Corning's expansion of capacity at Taloja facility, India's installed glass-fibre capacity will increase to 67,000 tons a year by the end of 2007. The demand for glass-fibre in India is expected to increase by 18 per cent a year over the medium term, driven by growing infrastructure and automotive sectors, IFC said. IFC's investment will help the company continue to improve efficiency and competitiveness, Owens Corning Managing Director Satish Kulkarni said. Owens Corning is a joint venture between US-based Owens Corning and India's Mahindra and Mahindra. (ET) […]

BCCL picks up 6.25% stake in IRL

Bennett, Coleman and Co (BCCL) has acquired 6.25% stake in ICRI Research Private (IRL), a leading clinical research education company in India, a BCCL release said. IRL Group chairman Shiv Raman Dugal said: “The market for clinical research education is growing and our association with BCCL has come at the right time and could prove to be an important milestone in the life of the company.” India contributes only 0.7% to the total global clinical trials market of $26 billion and analysts expect India to contribute 30% of revenue by 2010. India is fast emerging as a destination for clinical trials as it provides diverse genetic pool and low-cost technical services, the release added. ICRI society, the clinical research division of the group, is a pioneer of clinical research education in India and is growing at over 100% annually. Currently, ICRI has four campuses in Delhi, Mumbai, Bangalore and Ahmedabad. It is also exploring setting up campuses abroad and has a tie-up with Cranefield University (UK) for research & faculty support. (ET) […]