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Sector seeks capital to meet 15 per cent capital adequacy from April 2011. Lured by its 100 per cent growth and the fact that it seems immune from adverse global developments, private equity companies and venture capitalists are upbeat on investment in micro finance institutions (MFIs). According to Reserve Bank of India guidelines, MFIs will have to maintain a 15 per cent capital adequacy ratio from April 2011. At present, the requirement is 10 per cent, which they have to increase to 12 per cent from April 2010. […]
Merger and acquisition activity in the country more than doubled in the first month of 2010 as deals worth nearly USD 3 billion (about Rs 13,950 crore) were announced amid improved signs of liquidity, a study said. According to the monthly deal report of VCEdge, a financial research provider, the M&A deal value during January 2010 stood at USD 2.8 billion, a whopping 126 per cent rise over the same period last year. In terms of deal count there was also an upward trend, as there were around 53 deals in the first month of the year, as compared to 32 deals witnessed during a year-ago period, the report added. […]
Private equity funds are looking at emerging markets as their investment destination in 2010, and India has emerged as the second most preferred country after China for investment, says a survey. According to a survey by global PE research firm Preqin, the Asian countries are receiving considerable investor interest, with 45 per cent of respondents saying that this region is attractive at present. Supported by strong fundraising targeted at the country for the past couple of years, China was voted as an area of interest by just over half of respondents, followed by India for which 41 per cent voted in favour, Preqin said. […]
Private equity investments in India doubled in the first month of this year, as deals worth over $386 million were announced amid improving signs of liquidity, a study says. According to the monthly deal update report of VCEdge, a financial research provider, private equity deal value in India was at $386 million in January 2010 against $191 million in January 2009. The deal volume, however, was virtually unchanged with 25 deals recorded past month, one less than what was registered in the same month last year. […]
India’s education and training market is a $40-billion opportunity for investors. Around 350 private equity and venture capital (PE/VC) firms in India are looking at the education sector. Sitting over $10 billion, they plan to invest $500 million (Rs 2,300 crore) in the sector. India’s education and training market was a $40-billion opportunity for investors with schools and colleges capable of attracting around $28 billion, said PE players. No wonder investments in the sector are likely to double in 2010 compared to 2009. The sector figures among the top three investment destinations among PE players. In 2009, PE investments in education saw a three-fold rise. According to data from Grand Thornton, PE investments in the sector went up from $35 million in 2008 to $108 million till October 2009. […]
After a lacklustre 2009, when private equity (PE) fund raising was low, India-focused PE funds are set to raise nearly $2 billion in the first half of 2010. UTI Ventures, Multiples, floated by Renuka Ramnath, ex-CitiVenture Ajay Relan’s CX Partners and Everstone Partners are close to raising nearly $2 billion overall. Industry sources said Ramnath had raised nearly $300 million of the targeted $450 million while UTI Ventures was set to close a $350-million fund. “Ajay Relan, who led Citigroup’s venture arm for a long time, is raising $400 million and is understood to have managed his first closure of $225 million. Everstone Capital, a spinoff from Future Group, is on track to raise nearly $300 million,” a source in the know told Business Standard. […]
The evergreen and recession-proof characteristics of the education sector are drawing interest among private equity firms. Billed to be a $80-billion market, the number of private equity deals in the education space has grown four-fold in the last four years. According to Venture Intelligence, a Chennai-based research firm focused on private equity and mergers & acquisitions, eight deals worth $121 million were sealed in 2009, compared with just two deals worth $73 million in 2006. The first educational institute to get venture capital funding in India was Career Launcher from Intel Capital as early as in 2000. And last week, India Equity Partners invested Rs 172 crore for a 26% stake in IL&FS Education and Technology Services, which provides training to schools, colleges and to the government and corporate sector. […]
Private equity transactions in India fell by a significant 68 per cent in 2009 as investors resorted to a wait and watch approach amid the slowdown. According to a report by global consultancy firm Grant Thornton, there were 206 deals in 2009 with a total announced value of USD 3.44 billion (Rs 15,953 crore), a fall of 68 per cent from the year ago period (2008) when as many as 312 deals worth USD 10.59 billion were announced. There was, however, an upsurge in fund raising activity through institutional placement. “In the absence of active private equity participation, several large companies turned to qualified institutional placement (QIPs) to fund their renewed acquisition appetite. […]
Private equity players investing in India are having a tough time convincing investors — both domestic and overseas — to put money into their funds. This is despite stable economic growth, buoyant stock markets and a favourable investment climate. Continuing credit crisis in the US and Europe, coupled with fear among domestic investors to invest in an illiquid asset class, has made private equity fund-raising an uphill task. Logging a near 60% fall, net PE mobilisation has declined from Rs 1,944 crore in 2007 to Rs 792 crore in 2009 (till January 15, 2010), according to data collated by PE research firm Venture Intelligence. The number of PE funds hitting the road to raise money has halved from 30 in 2007 to 15 in 2009. Surprisingly, in 2008, when the whole financial world was in the middle of the worst economic turmoil, PE funds raised over Rs 1,116 crore through 22 funds. […]
Venture Capital investment in Indian companies slumped 43 per cent to $475 million (around Rs 2,200 cr) in 2009, but analysts hope that the fund raising would pick up in the coming months. Venture capital (VC) firms invested $475 million over 92 deals in India in 2009, the data compiled by research firm Venture Intelligence in association with Global -India Venture Capital Association showed. VC funds had invested USD 836 million across 153 deals in 2008. “Liquidity position of the limited partners is improving and this will bring back the pace of VC investment in 2010. We have already seen an improvement in December quarter funding and it is expected to increase further going ahead,” Venture Intelligence chief executive Arun Natarajan said. […]
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