June 2012
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Indian PE may raise $50 million from US, Spanish investors

An Indian private equity fund, floated by a group of former corporate executives, is in advanced talks to raise an additional $50 million from Spanish and US investors, in the midst of tough market conditions.
Forum Synergies (India) PE Fund Managers is negotiating with marquee Spanish investor Ram Bhavnani and Madrid-based Orienta Capital for a fresh round of funds that will boost its corpus to $100 million.
Other investors expected to participate in this round are family offices and development financial institutions in Spain and US. Madrid-based Axon Capital is helping Forum Synergies to build alliances and raise capital in Europe.
“India offers a lot of opportunities; that is one of the reasons I like this project,” said Ram Bhavnani, who is of Indian origin. As one of the fund’s early backers, Bhavnani is now returning as a repeat investor.
“In Europe and America, opportunities for growth are under pressure, so investors are looking at select Indian businesses,” said Hemchandra Javeri, a co-founder of Forum Synergies along with Samir Inamdar and Ishwar Subramanian.
Forum Synergies’ fund called ‘India Knowledge-Manufacturing Fund-I’ will invest between $3 million and $15 million in companies across engineering, healthcare, clean technology, information and communication technology. In February the fund closed its first investment of Rs 16 crore in Captronic Systems, a Bangalore-based firm which tests equipment for the Indian Space Research Organisation and Defence Research and Development Organisation.
“Forum Synergies is helping us tap customers in US & Europe. We are talking to European Aeronautic Defence and Space Company,” said Vinod Mathews, founder of Captronic Systems.
Apart from focus on specialist sectors, the founders are also banking on their operational experience at the helm of blue-chip companies to draw in investors.
While Inamdar was formerly president of South Asia businesses for General Electric, Javeri led Nike India and Madura Garments.
“It is a unique private equity model run by professionals with leadership and operating expertise,” said CK Ranganathan, chairman, CavinKare. Ranganathan is among the early investors in the fund along with Tata Sons director Farrokh Kavarana and Ashok Leyland managing director Vinod Dasari.
“I chose them based on my confidence in their capability to deliver exceptional returns on my investments,” said Ranganathan about Forum Synergies founders.
Industry analyst Harish HV, a partner at Grant Thornton India, said there is a growing trend of investors betting on people with corporate experience. “Those days are over when you could just put in the money and forget about running the operations. Considering the economic conditions and high valuations, you need people who can add value,” he said.
Forum Synergies founders are part of a growing band of corporate executives entering the risk capital management space with sector-specific funds. Neeraj Bhargava, former chief executive of business process outsourcing firm, WNS Global Services, has floated Zodius Advisors to back start-ups that offer digital services.
Source: Economic Times

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