April 2008
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Don’t think every VC is an angel

India is an attractive venture capital (VC) destination today and the future will only get better. Many more VC funds will come in and entrepreneurs, at least the good ones, will be badgered by VCs for ‘lets-get-to-know-each-other-better’ meetings. This capital availability and increased VC activity is good for the entire entrepreneurial ecosystem. But, in all this hype and hysteria about VC and entrepreneurship, something has been missed. Namely, that in as much as due diligence is performed by VCs on entrepreneurs prior to making an investment, a reciprocal arrangement needs to be in place for VCs. Wheat needs to be separated from the chaff, the genuine from the pretenders. Classic VCs are partners in business, not purely opportunistic money makers. They see themselves as company builders, not just as investors. They don’t take short term stock market oriented investment decisions. They help build successful businesses, not spend time on financial engineering. In the early days of the Indian VC industry (that’s less than 20 years old!), most of the VCs had a lender’s mindset where risk minimisation (zero risk?) took precedence over risk management. They found it hard to understand the startup situation used as they were used to more stable and less risky Companies. The situation today has undergone a sea-change with the entry of Silicon Valley style VC funds. […]

Shinsei Bank, Kotak Realty buy 5.9% in Lemon Tree for $30 mn

Kotak Realty Fund and Japan's Shinsei Bank have jointly acquired a 5.9 per cent stake in Lemon Tree Hotels for 30 million dollars. Calculated at this rate, the New Delhi based hospitality firm is valued at more than 500 million dollars. The stake has been picked from the existing shareholders, a release said here today. “This is an investment in India's booming economy… no hotel company has matched Lemon Tree's track-record in growth,” Shinsei Corporate Advisory Services' Head Sanjay Sachdev said. Kotak Realty Fund is already an existing investor in Lemon Tree. […]

GHIS plans $500 mn fund for healthcare sector in India

US-based Global Healthcare Investments and Solutions (GHIS) is gearing up to launch a $500-million fund to invest in the booming Indian healthcare sector. With private equity investments in the domestic healthcare and pharma industry touching $400 million during the first nine months of 2007, global investors, too, have been taking an active interest. The fund will invest in companies providing hospital services, including diagnostics, radiotherapy, wellness, health insurance and loyalty programmes (behavioural modifications), GHIS president Jack Shevel, who was here to attend a three-day Technopak-hosted health conclave, told ET on Wednesday. Initially, the fund’s corpus will be small, about $50-100 million, and aimed at hospitals with a bed capacity of over 150 and critical mass. The fund would be launched in phases and operate for two years. “We expect to finalise the fund in six-to-nine months time,” he said. GHIS is also engaged in discussions with at least 20 listed entities in the healthcare space to forge a strategic partnership. The list includes majors like Apollo, Fortis, Max, Wockhardt and the Mallya group. […]

Sabre Abraaj invested Rs 1 Bn in ECI

Hyderabad-based ECI Engineering and Construction Company (ECI), raised Rs 1 billion of private equity capital through a preferential allotment to Sabre Abraaj India Private Equity Fund I (Sabre Abraaj), a fund managed by Sabre Capital. ECI will use these proceeds to expand its construction business, finance its investment in hydro power BOOT projects and also build a modern manufacturing unit to fabricate steel towers required for their core power transmission and distribution (T&D) business. […]

PTC India to float energy fund

PTC India Ltd will soon float an energy fund to finance power projects in the country, the company's chairman and managing director Tantra Narayan Thakur said on Thursday. “We have an in-principle decision to float an energy fund under the PTC's investment arm PTC Financial Services. We are in talks with the banks and financial institutions to tie up debt for the fund,” Thakur said. He declined to reveal details like the corpus of the fund and the date of commencement. PTC Financial Services is also looking at raising debt for its project financing operations. “So far we have been only taking equity in power projects against the investments. But since the RBI guidelines prevent us from investing more than 20% of our net worth by way of equity in a single project, we are talking to banks and financial institutions to syndicate debt to invest in such projects,” Thakur said. PTC India floated an investment arm called PTC Financial Services Ltd about six months back to invest in power projects. Australia's Macquarie group and US-based Goldman Sachs have 20% equity stake each in the company. […]

Cyber Media aquires United Business Media

Cyber Media has acquired 100 per cent stake in United Business Media LLC for an undisclosed sum. United Business Media will become a subsidiary of Cyber Media. UBM LLC will continue to provide services to support and enhance the products and services being delivered by CyberMedia. Formerly a 50:50 JV, UBM-CyberMedia LLC has been publishing a monthly magazine Global Services, a website www.globalservicesmedia.com and produces events for the global outsourcing and off-shoring community. All products and services are published under the brand name of global services and endeavor to facilitate the global outsourcing industry by providing information and relevant platforms for buyers and sellers of professional services. The magazine has a print order of 30,000 amongst buyers of professional services in North America and Western Europe, the website attracts 21,000 unique and relevant professionals every month; and the joint venture has conducted close to 10 successful events bringing together this community. […]

IndiaVenture to announce first deal in few weeks

Private equity firm IndiaVenture Advisors Pvt Ltd is expected to announce its first investment in the next few weeks, Chief Operating Officer Vikram Gupta said on Thursday. “We have identified few investments in the healthcare delivery and support services. We should be making some announcements in the next few weeks,” Gupta told reporters on the sidelines of a conference. The average deal size could vary between $5-$15 million, he added. The fund has a corpus of $200 million with a focus on the healthcare sector. IndiaVenture is promoted by the founders of drug maker Piramal Healthcare Ltd, previously known as Nicholas Piramal India Ltd. (Reuters) […]

Royal Orchid picks up 50% stake in Goa hotel

Royal Orchid Hotels has announced that it has acquired a 50% stake in Galaxy Beach Resort located at Utorda beach in South Goa. Galaxy Beach Resort, a boutique beach hotel with 65 room capacity, will now be owned by Royal Orchid along with Vascon Engineers, a release said. “The in-vestment in the property in Goa reflects our aggressive growth plans. Goa is a national tourism hub and the acquisition further strengthens our presence in the tourism circuit in addition to our hotels at key business locations across India”, Royal Orchid chairman and managing director Chender Baljee said. The resort will be upgraded in the coming months. The upgradation is expected to be completed by this October. […]