Private-equity investors are being offered stakes in Indian companies as hedge funds and banks seek to offload assets, said an executive at 3i Group Plc. Hedge funds and banks that bought minority stakes in Indian firms in recent years are finding it hard to unwind their investments because the “listed market is dead,” said Anil Ahuja, who heads the Asian business of the London-based private- equity firm. 3i has poured more than $2 billion into Asia since 2006, and last month invested $161 million in Krishnapatnam Port Company Ltd., its third infrastructure investment in the nation. “There’s a whole new slew of transactions that are starting to be discussed where people who need the capital are offloading stakes which they hold in unlisted companies,” he said, declining to name the companies. […]

Collapse of discount retailer Subhiksha coupled with economic downturn and fear-psychosis created by the Satyam scam is leading private equity investors to rethink their investment strategies in India, mainly in those firms with significant promoter control, experts say. “The Subhiksha incident will make PE firms more cautious on how much of a free hand they allow to a promoter. Some PE funds are concerned that promoters have a wide range of authority in their companies and could look to establish structures that would limit some of this authority,” KPMG Head of Private Equity Advisory Group Vikram Utamsingh told media. Meanwhile, SMC Capitals equity head Jagannadham Thunuguntla said success and failure are a part of the PE business. […]