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IVCF launches three new funds

In keeping with its core business of venture capital funding, IFCI Venture Capital Funds Limited (IVCF), a subsidiary of IFCI on Monday announced the launch of three new funds aimed at the emerging sectors of the economy. The funds being launched are India Automotive Component Manufacturers Private Equity Fund with a target corpus of Euro 60 million or Rs 396 crores. It will be dedicated to investments mainly in Indian automotive component companies and other related sectors. The next one is the India Enterprise Development Fund (IEDF), with a target corpus of Rs 250 crores to invest in knowledge based projects in key sectors of the Indian economy with outstanding growth prospects. […]

AT&T may buy Maxis' 74 pct in India's Aircel

Top U.S. phone company AT&T Inc is close to buying Malaysia's Maxis Communications' 74 percent stake in Indian mobile operator Aircel, the Economic Times said on Monday, citing unnamed sources. AT&T, which is seeking to re-enter the world's fastest-growing cellular market, has valued Aircel at $5-$6 billion, the newspaper said. “At the upper end, the ticket price includes a control premium of around 30 percent, which AT&T is expected to pay for taking management control,” it said. The paper said Maxis CEO Sandip Das declined comment. Maxis, Malaysia's top mobile services firm, holds 74 percent in Aircel, the maximum permissible by Indian law, with the remainder held by India's Apollo Hospitals Enterprises . […]

Canaan to invest more in India

Canaan Partners, the 20-year-old global venture capital (VC) fund with $3 billion under management, will channel a bigger share of money from its latest global fund towards investments in the country. The investments would be mainly directed towards technology ventures, Canaan Partners India MD Alok Mittal said. The VC firm recently raised a $650-million global fund and about a quarter of it will be dedicated for investments in India and Israel. It is estimated that around $150 million will be invested in India over the next three years. Around 5-10% of its previous $450 million was dedicated to India and Israel. Canaan has invested in five companies in India—e4e, Bharatmatrimony, Cellcast, iYogi and TechTribe—since foraying into the country in 2000. […]

Lehman, Sachs, ICICI to pick 20% in OOH ad co

Private equity is ramping up presence in India’s out-of-home (OOH) advertising play. ICICI Ventures, Lehman and Goldman Sachs have lined up to pick up around 15-20% stake in Bangalore-based outdoor advertising firm Serve & Volley (S&V) for Rs 250 crore. Sources said Serve & Volley, with key assets like Delhi Metro, Kolkata Metro and Bangalore Municipal Corporation, plans to dilute 15-20% to raise Rs 300 crore. The 11-year-old company vies with sector leaders like Clear Channel, Laqshya and JCDecaux for a pie in the Rs 1,800-crore business, growing robustly at 10-15% in recent times. When contacted, S&V’s COO J Vishwanath declined to comment. Sources said advanced discussions were on with at least three funds for raising Rs 300 crore. […]

PE investments take a beating

With a bearish phase prevailing over stock markets, valuations of private equity (PE) investments have taken a beating. Certain PEs which had overestimated companies to enter at high values have seen a decline in valuations due to volatile capital market conditions. A compilation of how PE investments of 2007 compare with current mark-to-market (MTM) values shows that about 58% of the PIPE (private investments in public enterprises) deals of 2007 are in the negative territory. According to the research undertaken by SMC Investment Solutions & Services (May 2008), the only ray of hope is that overall till-date-returns on PIPE deals of 2007 (on volume basis) are still in the positive, although at a margal 8.3%, despite rough market conditions of 2008. […]

PE firms review plans after Ranbaxy deal

In the wake of the recent Ranbaxy-Daiichi deal that took many by surprise, private equity (PE) firms are treading a more cautious path in their approach towards investments in the fast-growing Indian drug companies. The way the leading Indian drug firm, Ranbaxy Laboratories, was acquired by Japan's Daiichi Sankyo, has made them realise the vulnerable nature of the domestic pharmaceutical industry and the need for more preconditions to prevent the promoter from selling off his company soon after the investments are made. Though PE interest in the pharmaceutical sector is rather small compared to other sectors, about 20 PE firms had made small investments in the healthcare sector in 2007. The significant ones included Chryscapital's $24-million investment in Mankind Pharma, Avenue Capital putting in $17.91 million in Morepen Laboratories, and Rideback Capital investing about $5 million in Granules India. The Ranbaxy-Daiichi deal is expected to make PE firms review their positions on investments in acquisition-prone industries like pharmaceuticals. “PE companies invest in a company if they feel that its promoter can deliver goods. If the promoter changes, then its a different ball game. […]