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The Anand Jain promoted Jai Corp Ltd, which has been traditionally into manufacturing businesses like steel, plastic processing and spinning yarn, is planning to raise a venture capital corpus of Rs 40,000 crore through its wholly owned subsidiary, Urban Infrastructure Venture Capital (Pvt) Ltd. Jai Corp has already committed a capital of Rs 22,000 crore in 12 cities in India. The major investments would be in multiuse projects and townships (22% each), residential (15%) commercial (14%), industrial township (12%) and hospitality (6%). UIVCPL will be a venture capital company with a focus on the real estate sector. […]
ItzCash Card Ltd, the prepaid cash card company that is part of the Essel Group, has received a $10 million private equity (PE) investment from Matrix Partners and Intel Capital. Matrix Partners India is headed by Avnish Bajaj, the co-founder of Baaze.com, which was acquired by online and shopping website eBay. US-based Intel Capital is the venture capital organisation of Intel Corp and its investments around the world are worth $1.89 billion. Ashok Goel, chairman, ItzCash Card Ltd, told DNA Money that the funding was necessary to gauge the value of the company. He, however, did not divulge the current value of the company. “We thought this was the best way (PE funding) because the other alternatives were an IPO or a paid valuation research by companies like KPMG,” Goel said. When asked about how this funding would be utilised, Goel said: “We plan to use this investment to expand from the online space to the physical space.” […]
What is rising besides the Sensex and real estate prices? The answer could be valuations of retail broking houses. Washington-based International Finance Corporation (IFC) has bought a 12.5% stake in Angel Broking, a Mumbai-based stock broking firm, for around Rs 150 crore. IFC is the investment arm of World Bank. The deal, managed by Rothschild, pegs the enterprise value of the broking firm at around Rs 1,200 crore. Angel Broking has already finalised the deal, and the company board is expected to meet soon to approve the IFC’s investment proposal, according to sources involved with the development. Industry sources pointed out that Angel’s valuation is much higher than that of Sharekhan, a retail arm of SSKI, which is estimated to be in the region of Rs 650-700 crore. SSKI promoters are believed to have sold a majority stake in Sharekhan to Citigroup Venture Capital International. While a total of 12 investors had participated in Angel’s bidding process, three of them were shortlisted for final round of negotiation. The highest bid was 10-12% higher than what IFC offered to pay, said sources. However, the promoters of Angel decided to go ahead with IFC. […]
Escalating interest rates, perception of a real estate asset bubble and aftershocks of US subprime credit defaults have not dampened the spirits of overseas funds looking to invest in the Indian realty sector. In the past nine months, overseas funds have raised around $2.4 billion towards investment in real estate projects; and if estimates are to be believed another $1.1 billion will flow in before the end of this year — taking the grand total to a whopping $3.5 billion. Real estate fund-raising continues to boom in 2007 following strong returns from real estate firms. According to the London-based Private Equity Intelligence (Preqin), 88 new funds have raised an aggregate $59 billion this year as compared with $72 billion by 116 new funds in the whole of 2006. Although firms are raising record amounts of capital, there are now more funds on the road than ever. Over 200 funds are looking to deploy an aggregate $105 billion in the sector across the world in 2008. This is thrice the amount raised as recently as January 2007, and a massive six times increase from January 2006, says a Preqin study. […]
When it comes to project financing, realty-focused private equity funds are churning out the dollars. JP Morgan's USD 360 million India-focused fund has made its largest investment so far in an IT park in Navi Mumbai. This 40-acre plot, near Patni Knowledge Park in Airoli, in Navi Mumbai, will soon host a sprawling IT park. JP Morgan's realty fund will cash in on demand from it and ITES companies to shift to such cheaper locations. The fund will invest Rs 100 crore or over USD 25 million in the development. We hear JP Morgan's property fund will buy 40% in the 4.5 million-square-foot IT park, to be developed on this plot by the B Raheja Group. Although the Rahejas and JP Morgan have refused to comment on the deal, according to sources, B Raheja will consider applying for an IT SEZ notification for this development. The B Raheja Group recently received an investment of USD 45 million from US-based investment banker Wachovia, for two projects in Bangalore. And JP Morgan's realty fund has invested USD 10 million each in Hyderabad-based Modi Developers and Chennai Based Arihant Foundations for middle-income group housing. The fund is also about to finalise an investment in an IT-cum-residential complex in Kolkata's new town Rajarhat with Unicon Builders.(Money Control) […]
Hyderabad-based venture capital investor Ventureast Funds, the former joint venture with Andhra Pradesh Industrial Development Corp. Ltd (APIDC), plans to raise new funds worth $150 million (around Rs590 crore) by March. The firm, which currently manages $150 million, “plans to double the capital under management”, said Sarath Naru, managing director, Ventureast. Among the funds planned, two will focus exclusively on life sciences and information technology (IT), respectively. The life sciences fund will be branded under the APIDC umbrella and the IT-focused fund under the Ventureast brand. The firm, formally registered as APIDC Venture Capital Ltd, manages funds under both brands. While it is still working on the details, the IT fund will be managed out of its Chennai office, while the life sciences fund will operate from Hyderabad. The new funds will have repeat investors, Naru said. Current investors include domestic investors such as Andhra Bank, Indian Overseas Bank and Life Insurance Corp., and overseas investors such as IFC Washington, Saudi Economic and Development Co. (Saudi Arabia) and Norfund (Norway). Ventureast, an outfit that Naru founded, set up its first fund in the country in 1997 as a joint venture with APIDC, when the state government outfit decided to partially privatize its venture capital operations. At the time, APIDC owned a 49% stake in APIDC Venture. […]
Engineering and construction major Larsen & Toubro on Thursday said it would acquire Tamco Switchgear Malaysia Sdn Bhd, the de-merged switchgear business of Malaysia-based Tamco Corporate Holdings Bhd. In this regard, the firm entered into a share sale agreement with Tamco Corporate Holdings Bhd in Kuala Lumpur on Thursday, according to a filing with the Bombay Stock Exchange. However, the financial details of the deal were not disclosed. “Tamco has a strong presence in the medium voltage (MV) category. With this acquisition, L&T will be able to offer a comprehensive range of MV switchgears in the domestic as well as international markets. This deal meets our requirements on both fronts of technology acquisition and market access. “L&T's process improvement initiatives will help achieve cost efficiency and contribute to synergy benefits,” said L&T President (Operations) and Member of the Board R N Mukhija. Tamco is a major player in MV switchgear in Malaysia. The Middle East and Malaysia together contribute to over 50 per cent of its revenues. […]
Private equity has come a long way since the days of Technology Development and Information Company of India (TDICI), the first Indian company with a mandate to do venture capital, that was floated jointly by ICICI and UTI in the late 1980s. The quarter to September 2007 saw $3.52 billion worth of private equity deals in India – something TDICI's first president and chief executive officer Kiran Nadkarni could not have imagined in those in his wildest dreams. Nadkarni moved on and TDICI became ICICI Venture in the mid-1990s. But that's another story. Cutting to the chase, private equity is gaining juggernaut proportions in India. Private equity is a broad term which means shares of a company that are not listed on an exchange. So traditionally, those who buy such shares are called private equity investors, and, according to a recent study by Evalueserve, there are 366 of such entities operating in India. […]
A clutch of investors are understood to have evinced interest in the country’s largest urban housing project. Five Private Equity (PE) firms, including Warburg Pincus, Goldman Sachs and AIG, are mulling exposure in the Rs 62,000-crore Satyagriha project involving around 20 realty developers across 15 Indian cities, sources said. India’s biggest private sector housing venture is expected to develop 342,000 homes priced between Rs 7-75 to Rs 22. 25 lakh over the next six years. The project is being marketed and managed by Bangalore-based Asipac Projects, and is expected to kick off in Jaipur later this month. The total land under development for the project is 634 acres. Besides Warburg, Goldman and AIG, two other funds, Barings Asia and Lightspeed Ventures, have also shown preliminary interest in picking up stake in the master asset holding company of the project, sources added. Sources said some of the bigger PEs could take an exposure of around $300 million initially. It is believed that a relatively smaller fund like Lightspeed could look at sewing up a consortium play targeted at one segment of the project development. It is possible that the project with a unified procurement, marketing and sales strategy might have multiple asset management companies. For instance, procurement alone could look at big-ticket investors given its Rs 24,500 crore size over a six year period, sources added. When contacted, Asipac Chairman Amit Bagaria declined to comment. The first phase of the Satyagriha project will include 64,000 homes spread over 18 projects in 10 cities. […]
Private equity interest in microfinance institutions (MFIs) is reaching a crescendo with heavyweights such as Blackstone and Carlyle willing to invest in the sector. Both these groups have shown interest in putting money into MFIs, said a source close to the development. The quantum of investments may be upwards of $20 million. The target firms are not yet clear. “They are keen on making huge investments, but they are yet to decide on the MFIs. Since most of the big MFIs are saturated with funds, they may need to look at multiple investments in smaller MFIs,” the source said. There nearly 15-20 serious funds in the sector, but very few look at tier 2 and 3 categories of MFIs. While the Blackstone group refused to comment, a spokesperson at Carlyle was unavailable for comment. “PE investors look at hard growth numbers and these organisations throw up incredible growth figures, year after year. With a CAGR of 100%, this sector is very attractive,” he added. Of the 200 odd MFIs in the country, only the top 10 corner most of the funds. PE investors find it a daunting task to zero in on credible investments. […]
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