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A majority of private equity (PE) players in the country expect a decline in activity in 2009 with only 28% expecting the scenario to improve over the same period, according to a Grant Thornton survey on mergers and acquisitions (M&As) and PE investment scenario in India. 58% agree that the turmoil has affected M&A activity, but 45% believe that current valuations will increase deal activity in the short-term and more than 88% of the respondents believe that M&A is an integral part of their organisation's business strategy for growth. […]
With most financial markets witnessing a slowdown which has resulted in more reasonable valuations, corporate houses and private equity players believe that the current valuations would result in increased merger and acquisition (M&A) activity in the coming months, according to a survey conducted by Grant Thornton. Over 45 per cent of respondents felt that the current valuations would result in increased M&A activity. An overwhelming 91 per cent of the respondents believed that the Indian economy has scope of […]
Poised to invest Rs 24,415 crore in smaller enterprises Small and Medium Enterprises (SMEs), to which most banks are chary of lending, are being actively wooed by private equity (PE) investors. According to industry representatives around 70 per cent of the PE investment that came into India last year was invested in SMEs. PE funds are poised to invest an estimated Rs 24,415 crore ($5 billion) in Indian SMEs, they added. In the PE context, companies with revenues in the Rs 50-500 crore range have been categorised as SMEs. […]
Amidst a volatile market, education is emerging rapidly as a safe bet for venture capitalists and PE investors. Experts believe for the next 4 to 5 years, education is going to attract significant investments. The movement in the market is already visible with venture capitalist Matrix Partners India pumping in Rs 100 crore in FIITJEE and PE player Franklin Templeton putting in Rs 50 crore in Career Point. More such big-ticket investment deals are expected in coming times, according to the market sources. […]
If emerging India needs to invest in its infrastructure, private equity players do not see funds as a hurdle to the big India story. PE players ET spoke to on Wednesday in Ahmedabad said raising funds for infrastructure projects was not really a challenge . The PE players were talking to ET on the sidelines of VC Circle investment Forum’s meet themed ‘Capital Strategies for a Reviving Economy’ on Wednesday. However, the top officials of some of the prominent PE funds were concerned about stringent regulations in the capital-intensive sector. The PE players believed, rationalisation of regulations could make it easier for them to fund the projects. […]
Private equity and venture capital investments in the country's renewable energy space totalled USD 527 million during the past four years, accounting for nearly a fourth of the total transaction valuations. “PE,VC players have invested USD 527 million in the country's renewable enrgy sector– 24 per cent of te total transaction value in India for the period January 2005-July 21, 2009,” global consultancy firm Ernst &Young said. During the four-year period, the merger and acquisition and PE/VC activity in India's renewable energy space stood at USD 2.15 billion. The average deal size stood at USD 69.5 million during the same period. […]
As valuation of Indian companies have improved with the recovery in the stock market, a number of private equity players are offloading their stakes and such exits have shot up nearly 30 per cent in the first seven months of 2009. Till July this year, India Inc saw as many as 31 deals where the PE firms sold their stakes in domestic companies – an increase of 29 per cent over the corresponding period a year ago. In the comparable period there were 24 such deals, according to data compiled by the deal-tracking firm Venture Intelligence. “PE firms which are currently exiting, invested in Indian companies way back in 2004-05. With the recovery in the stock market, they are now finding valuations attractive and are selling stake,” Venture Intelligence CEO Arun Natarajan said. […]
Private equity (PE) companies in India prefer to pick up minority stakes in companies rather than majority ones, a Tuesday report from New Delhi-based investment bank SMC Capitals Ltd said. Between calendar 2005 and the first half of calendar 2009, the total value of PE deals was $41.91 billion (Rs2 trillion at Tuesday’s rates) but only $2.52 billion (Rs0.12 trillion), or 6%, of those were controlling stake transactions, the report said. The largest controlling stake transactions were the $900 million investment, worth an 85% stake, by Kohlberg Kravis Roberts and Co. (KKR) in Flextronics Software Systems in 2006 and the $200 million investment worth an 80% stake by the Blackstone group in Intelenet Global Services Pvt. Ltd in 2007. The report said that the trend could likely be because Indian promoters are emotionally attached to their firms. […]
Venture capitalists/PE (private equity) funds are now looking at investing in micro finance companies in India. According to industry observers, around Rs 1,000 crore is expected to be invested by venture capitalists/PE funds in the Indian micro finance space (MFIs) this year. In fact, of the 50 private equity deals worth $1 billion in banking and finance in the last 18 months, MFIs alone accounted for 20 deals amounting to $200 million. There are some funds like Aavishkaar and Bellwether Microfinance Fund that primarily invest in MFIs in India. “Apart from MFI focused funds, other venture capitalists and PE funds who consider opportunities in the financial services space are now adding micro finance to their portfolio,” says Mona Kachhwaha, director, Bellwether. […]
Exits by venture capital (VC) firms slumped to their worst since 2007 in the first half of this year as mismatched valuations soured deals, and an overall liquidity crunch took a toll on the buying and public issue plans of Indian companies. Between January and June, only four firms saw exits by their VC investors, compared with five exits in the first half of last year and 14 in the same period in 2007, according to a study by Venture Intelligence, a research firm focused on private equity and merger and acquisition (M&A) deals in India. […]
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