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When steel-pipe maker Welspun Gujarat Stahl Rohren (WGSR) won the contract for the world’s deepest gas pipeline in the Gulf of Mexico from El Paso, not only did it earn accolades from National Geographic, but it also had Europe’s largest private equity firm 3i Investments sit up and take notice. Says Anil Ahuja, managing director and co-head, Asia, 3i Investments: “WGSR is among the top few global suppliers of line pipes in the oil and gas sector. It’s a space we liked but could not get an unlisted player to invest in, so we picked up a 6.6 per cent stake in WGSR for $80 million (Rs 320 crore) from the secondary market.” Mergers and acquisitions are passé, the new buzz on Dalal Street is PIPE—private investment in public equity—as private equity players make the 8,000-strong listed companies their new target. While the foreign institutional investors have been busy chasing the bluechips, the private equity players have been quietly hunting on Indian bourses for small and mid-cap companies. And the sectors seeing maximum PIPE deals are cement, construction, oil and gas and infrastructure. As a trend, PIPE is no more than five years old, even in the global markets. From $20 billion (Rs 80,000 crore) in 2000, global PIPE deals have risen to $45 billion (Rs 1.8 lakh crore) in 2007. Till October, $1.71 (Rs 6,840 crore) billion had been invested in 16 PIPE deals in India against $1.25 billion (Rs 5,000 crore) across 36 deals in 2006. […]
The Centre for Executive Education (CEE) at the Indian School of Business (ISB) is conducting an advanced level special programme on private equity. This programme is being offered in association with Times Private Treaties, the strategic investment arm of the media conglomerate The Times Group. The programme has been designed for banking, finance and insurance professionals who aspire for a career in private equity, lawyers, chartered accountants and CPAs working with private equity companies. Being conducted at ISB in February 2008, the programme will be led by two internationally-renowned experts Thomas Frederik Hellmann, associate professor at the Sauder School of Business, University of British Columbia, and Marco Da Rin, assistant professor at Turin University. Deepak Chandra, associate dean for executive education at ISB says: “The Indian private equity market is unique in many ways and is fast attracting the attention of many global players. To fuel this growth, companies need to invest in professionals who have an in depth expertise of best practices and the knowhow to make them work for India. CEE at the ISB has designed this programme to bring Indian professionals up to speed on global standards.” Adds Sunil Rajshekhar, director, Times Private Treaties: “We at the Times Group believe that the private equity market is growing exponentially with a demand for global expertise. The ISB’s edge in delivering world-class education and its globally-renowned faculty will ensure a truly global-local learning for participants in this special programme.” […]
Sequoia Capital and a Singapore-based private equity fund are learnt to be in the race to invest upwards of Rs 100 crore in Mysore-based e-learning firm Excelsoft. Excelsoft is a six-year-old firm which provides a range of customised learner-centric learning systems, test and assessment systems, and desktop tools. According to industry information, the company, which has a topline of around Rs 50 crore is expected to be valued in the range of Rs 350-400 crore for the stake sale. A deal is expected to be sealed by early-January 2008. Industry sources further indicate that in addition to Sequoia and the Singapore fund, ICICI Venture is also in the fray to invest in this high-margin firm. Estimates are that Excelsoft has a net profit of close to Rs 25 crore due to its business model of taking the product licensing route on which services and consulting add value and stickiness. […]
Riverbank Holdings Pvt Limited, a joint venture between Bata India Limited and Calcutta Metropolitan Group Limited has finalised a 50 per cent equity participation by Yatra Capital Limited for its IT SEZ project to come up at Batanagar. Yatra Capital which is the first India focussed investment company and the first Jersey incorporated company to list on Euronext, Amsterdam, has picked up 50 per cent equity in the project for Rs 117.6 crore. The investment by Yatra has been done by a special purpose company, K2A Commercial. The IT SEZ is a part of the Calcutta Riverside project which also includes an integrated township spread over an area of 262 acres on the banks of Hooghly river. Speaking on the occasion, Mr Sumit Dabriwala, managing director of RHPL said, the first phase of IT special economic zone will be completed by early 2010 and the entire project including the township is expected to be over by the last quarter of 2012. […]
Red Fort Capital, a global real estate private equity fund, is raising a Rs 800-crore, India-specific fund for the realty sector. This is in addition to its earlier allocation of Rs 1,600 crore for realty projects in the country. The new domestic fund is expected to be announced by the end of December and the company will start investing in the fund from March next year. “We plan to raise the capital from high networth individuals and corporates in India. A major part of the fund has been tied up,” said Parry Singh, director, Red Fort Capital Advisors. He said the company would invest the Rs 800-crore, non-FDI fund in redevelopment projects in cities and non-FDI compliance projects, among others. […]
Private investment firm Sage Capital Advisors Pvt. Ltd plans to form a joint venture (JV) with a financial services group to launch a private equity (PE) fund or its own fund, an official said on Wednesday. “We are exploring a JV with a large financial services group as the platform will allow us to get quality investors,” said managing director Manish Kanchan, adding that Sage would hold a majority stake in the planned venture. “We can even raise up to $1 billion (Rs3,940 crore) through this JV.” Kanchan said the name of the partner and other details would be announced in a month’s time. He also said the firm is talking with potential investors to launch a PE fund of around $200-250 million if the JV falls through. PE investment in India is expected to touch about $10 billion in 2007. Investment had more than tripled to $7.46 billion in 2006, from $2.26 billion in 2005. […]
Private equity firm IL&FS Investment Managers Ltd, an arm of Infrastructure Leasing & Financial Services Ltd. (IL&FS), said it received $578 million (Rs2,277 crore) of commitments for investing in real estate projects as demand surges in the world’s fastest-growing economy after China. The Mumbai-based company, which had the first closure on its real estate fund on Wednesday, plans to raise up to $750 million mainly from global institutions over the next three months, said Shahzaad Dalal, vice-chairman, in a phone interview. […]
A clutch of domestic banks and foreign financial investors (FIIs) has picked up around 9% stake in GMR Infrastructure, the flagship company of the GMR group, for around $1 billion through a qualified institutional placement (QIP). The deal is the largest among the recent QIP deals. The investors include State Bank of India (SBI), Canara Bank, Capital International, Citigroup, T Rowe Price, Credit Agricole, UBS and Kotak Mahindra. The deal involves selling part-stake by promoters and issuing fresh shares. Post-issue, promoters’ holding will be down to 74%, while the public and new investors together will hold the remaining 26%. Sources said SBI and Canara Bank were the largest investors in the QIP, investing Rs 500 crore each. Other investors have invested between $40 million and $70 million. […]
GoAir is believed to be mulling over bringing in a new equity partner from among three aspirants, including a leading Indian corporate and a global venture capitalist – a move that would help the Wadias-promoted airline to expand its fleet to 40 aircraft by 2012. Ahead of advancing the negotiations, the budget carrier has been valued at up to Rs 1,600 crore ($350-400 million) by a leading international consultancy firm. Asked about the new equity partner and the stage of negotiations, a company spokesperson declined to comment, saying: “As a policy, GoAir does not comment on market speculations.” With the recent round of consolidation in aviation space, such as Jet Airways-Air Sahara and Kingfisher-Deccan deals, GoAir is emerging as an attractive investment target and has received offers from an international venture capital firm, an Indian corporate and another domestic financial investor, people close to the development said. […]
Hyderabad-based Ramky Group, which had revenues of Rs1,000 crore last fiscal, is set to unlock value of three of its entities that attracted investments from global private equity (PE) firms through initial public offerings (IPOs). The group has three entities, Ramky Infrastructure Ltd, Ramky Enviro Engineers Ltd (REEL) and Ramky Estates and Farms Pvt. Ltd (REFL). The group is valued at around $3 billion (Rs11,880 crore). Global PE players that picked up minority holdings in these companies include Infrastructure Leasing & Financial Services Ltd (IL&FS), Sabre-Abraaj Capital, Lehman Brothers Holdings Inc. and Deutsche Bank AG. The first off the block with its IPO will be Ramky Infrastructure—a Rs720 crore company in revenues last year, which is mainly into developing industrial estates. Ramky Infrastructure plans to go public sometime in the first quarter of next year. […]
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