Your Eye to Indian Private Equity

Transcription

1 Four-S Private Equity Track Issue: 21st-27th February, 2011 Your Eye to Indian Private Equity PE activity for the week During the week ended 27th February, 2011 there were 4 PE/VC deals worth $75.1 as compared to 7 deals worth $32.4mn in the previous week Out of the total, 2 deals were early stage, 1 deal was growth stage and 1 was a project level deal Largest transaction during the week was by Red Fort Capital investing $44.mn in Ansal Properties JV th February 27th February 0 Private Equity: Investment Summary during the week Investor (s) Target Sector Business Stake (%) Amount Stage Red Fort Capital Ansal Properties and Infrastructure Real Estate- Residential Project CX Partners Cocoberry Retail Food Food Retail NA 20.0 Early Kitara Capital Oil Field Instrumentation Accel Partners Probe Equity Research Pvt Ltd Source: Four-S Database, Deal size in $mn PE Investments No. of Deals Others Oil Well Services Growth BFSI Research & Analytics NA NA Early Red Fort Capital invests in Ansal Properties JV Real estate PE firm Red Fort Capital is picking a 26% stake in a joint venture with Delhi-based Ansal Properties & Infrastructure Ltd for Rs 2bn. The JV will undertake expansion of a residential project in Gurgaon by developing an additional 108-acre township project adjacent to Ansal s existing 112-acre Esencia township project in Gurgaon. This is not the first time the two are forming a partnership. The public listed realty company that had also raised Rs 2.31bn separately through a qualified institutional placement of shares in October, had also raised a total of Rs 1.15bn from Red Fort for 22% stake in Parsvnath La Tropicana, a group housing project of the company in Delhi. For Red Fort this transaction comes as the third deal in last five months. Ajay Relan invests $20mn in Cocoberry Retail Gurgaon-based Cocoberry Retail Pvt Ltd, which owns frozen yogurt chain 'Cocoberry' has raised $20mn from Ajay Relan backed CX Partners. Founded in February 2009 and a part of Horizon RHI Group, Cocoberry which is into frozen fresh yogurt and fruit dessert item, is also venturing into soups and beverages. Cocoberry mostly works through a franchise method. It currently has 25 outlets and plans to reach a total of 500 stores in India, Southeast Asia and the Middle East by 2015 at an investment of Rs 1.2bn. The Company is planning to raise another $15-20mn through private equity route and plans to come out with an IPO by th January 23 rd January, 2011

2 Kitara Capital invests in Oil Field Instrumentation Kitara Capital, a PE firm headquartered in Muscat with presence in India and Dubai, has invested $11mn for a 35-35% stake in Mumbai-based Oil Field Instrumentation Ltd (OFIL), a provider of mud logging services to oil exploration companies. OFIL, under the Neterwala Group of companies, provides mud logging services to corporate establishments that are engaged in oil well drilling, exploration and development including deep waters and Coal Bed Methane (CBM). OFIL apparently holds 45% market share in India. The company has an installed capacity of 40 MLUs and has monitored more than 2500 wells in offshore and onshore locations. Accel Partners invests in Probe Equity Research Accel Partners has invested in Bangalore-based Probe Equity Research Pvt Ltd. The deal terms are not disclosed. Founded in 2004, Bangalore based Probe Equity is an investment research and analytics company that focuses on providing research support services to fund managers and other participants in the BFSI sector. Venture Capital firm Accel Partners investment portfolio includes companies like Ace Creative Learning, Letsuy.com, Mitra Biotech, Myntra Designs, Vinculum Solutions, among others. Fund Raising & Liquidity Events some of its other investments spread across Pune, Bangalore, Chennai and Hyderabad. Bangalore-based Nitesh Estates is engaged in the development of residential real estate & commercial projects. It is also developing a hospitality project in Bangalore, and a residential and an office project in Kochi. Nitesh Estates is also building a Rs 1bn luxury residential project in Bangalore which is expected to be completed in two years. Educomp launches PE fund Educomp Solutions Limited, India's largest listed education company, has launched a private equity fund for the education sector and has also opened its account by making its debut investment. India Education Fund, a SEBI registered venture capital fund, will be managed by its wholly owned subsidiary Educomp Investment Management Limited. Educomp is anchoring the fund with a Rs 500mn investment though the target corpus is not known. India Education Fund will invest in education and allied sectors. India Education Fund has also invested in Beacon Learning Pvt. Ltd, a management and services provider for higher education institutions. Private Equity and M&A News HDFC Property Ventures exists from JV project with Nitesh Estates HDFC Property Ventures Limited has sold its 50% stake in JV project - Nitesh Indiranagar Mall to JV partner Nitesh Estates Limited. HDFC's real estate arm invested $20mn in Nitesh s 1.5mn sq ft mall project at Indiranagar in Bangalore in HDFC Property Ventures is also planning to exit Creamline Dairy Products plans to raise PE funding Hyderabad-based Creamline Dairy Products Limited (CDPL), which sells 'Jersey' brand of dairy products, is planning to raise Rs 1bn through private equity. Founded in 1986 by K Bhasker Reddy and others, CDPL manufactures various dairy products which includes milk, curd, butter milk, paneer and ice-creams among others. CDPL has 7 milk processing plants in Andhra Pradesh, Tamil Nadu, Karnataka and Maharashtra, a network of over 1.3

3 lakh farmers covering 5,000 villages, 30 own and 9 associate milk chilling centers, 40 Bulk Milk Cooling Units (BMCUs), 7 packing stations, 6 sales offices and 1 powder plant/sbu at Ongole in Andhra Pradesh. The Company is planning to launch 6-7 new products in the next three years like cheese, table butter, specialized sweets, among others, taking its product portfolio from existing 15 to 21 products. Sujana Energy plans to raise $100mn through PE Hyderabad-based Sujana Energy Limited is planning to raise $100mn through private equity to fund its expansion into hybrid power generation. The company plans to set up units which will be a mix of solar, thermal and biofuel to generate 400 MW of power. Combining solar thermal power with biomass gas allows these plants to stay operational even when the after the sunset. Company will use gas produced from local agricultural waste and livestock manure for steam turbines at the unit. By 2014, company plans to set up plants across India, Middle East and US. Peppermint Hotels plans to raise funds for expansion Hotel chain Peppermint Hospitality India Pvt Ltd which runs Peppermint Hotels, is planning to raise funds for its expansion plans. Peppermint Hotels currently operates three hotels - one each in Gurgaon, Jaipur and Jodhpur. The company is planning to set up hotels in tier I and II cities such as Pune, Ahmedabad, Baroda, Kumarakom, and Bangalore. It plans to add seven new properties by September this year. IPO, Other offerings Auto Components firm Adroit Industries plans to raise Rs 500mn via IPO Auto components manufacturer Adroit Industries India Limited (AIIL) has filed DRHP with SEBI to raise Rs 500mn through IPO. AIIL is engaged in the manufacturing of propeller shaft and its components like universal joint, slip yoke, weld yoke, end yoke, companion flange & flange yoke, tube, stub shaft, etc. which are used in the commercial and passenger vehicles. Currently, company has three manufacturing units in Indore. IPO proceeds will be used to set up an additional manufacturing facility at Pithampur, Indore with the production capacity of 8,10,000 units p.a., for capex and for other corporate purposes. PE-backed Tree House Education files for IPO Matrix Partners-backed Tree House Education And Accessories Limited has filed DRHP to raise funds through IPO by issuing 9.69mn equity shares, which constitutes 28.76% of post-paid up capital of the company. The company plans to raise Rs 140mn in a pre-ipo placement of 1.26mn shares at Rs per share. The funds raised will be used for expansion of its pre-school business, acquisition of office space, procurement of exclusivity rights to provide educational services, construction of infrastructure for educational complexes in Rajasthan and Gujarat, repayment of loan and for other corporate purposes. Bangalore-Based TD Power Systems files for IPO Bangalore-based TD Power Systems Limited is planning to raise Rs 2.5bn through IPO and has filed DRHP with SEBI for the same. Incorporated in 1999, TD Power manufactures custom designed AC Generators with output capacity in the range of 1 MW to 52 MW for prime movers such as steam turbines, gas turbines, hydro turbines, wind turbines, diesel and gas engines. The funds raised will be used for expansion of its manufacturing plant at Dabaspet near Bangalore, to develop a project office in Bangalore, for repayment of debt, for working capital requirements and for other corporate purposes.

4 Executive Tracking Goldman moving Asia PE co-head to Mumbai in reorganization Goldman Sachs will relocate Ankur Sahu, a partner in its private equity business, to Mumbai from Tokyo as part of a reorganisation under which he will co-head private equity for Asia. Sahu will continue to co-head the firm's operations in Asia alongside his colleague Andrew Wolff, who leads the firm's operations in China from Hong Kong. Sahu had previously been focusing on transactions in Japan. Social venture firm Acumen appoints Meghna Rao as India Director Social venture capital investor Acumen Fund has appointed Meghna Rao as its new India Director. Rao will oversee the expansion of Acumen's work in India across health, water, energy and agriculture. Rao was till recently the Managing Director of Pluspak Containers Pvt Ltd, a mid-sized packaging manufacturing company based in Maharashtra. Before that, she spent four years at Microsoft in India and the United States, where she focused on the adoption of Microsoft's offerings among small businesses in India. Rao also worked in the mergers and acquisitions investment banking department at Goldman Sachs in New York and in venture capital at JH Whitney, Connecticut. M&A Activities Petroleum (BP) for $7.2bn M&A Activity: Summary during the week Acquiror Target Sector Stake (%) Deal value ($ mn) Fortis Global Healthcare Cancer Hospital in Singapore Healthcare MIH Group Gaadi Web Pvt Ltd M&E NA NA Delta Corp Limited Marvel Resorts Hospitality BP Reliance Industries - 23 oil blocks Infrastructure & Construction Ruia Group Acument GmbH Manufacturing 100 NA Educomp Gateforum Education NA NA Konecranes WMI Cranes Manufacturing QPS Holding Bioserve Healthcare NA NA Source: Four-S Database, Acquisition price is in $mn During the week ended 27th February, 2011, there were 8 M&A deals worth $20mn (Size of 4 deals was not known). In the largest deal during the week, Reliance Industries sold 30% stake in 23 oil and gas production sharing contracts that it operates in India (including the KG D6 block) to British

5 Stock Market Updates Key Domestic Indices Indian Market Movements 52 Week Index 25-Feb Feb-11 Change Low High BSE Sensex 17, , % 16, , S&P CNX Nifty 5, , % 4, , CNX Nifty Junior 10, , % 9, , Nifty Mid Cap 50 2, , % 2, , CNX IT 6, , % 5, , Bank Nifty 10, , % 8, , CNX Infrastructure 2, , % 2, , CNX Realty % Source: BSE, NSE statistics Key Global Indices Global Market Movements 52 Week Index 25-Feb Feb-11 Change Low High NASDAQ 2, , % 2, , DJIA 12, , % 9, , S&P 500 1, , % 1, , Nikkei 10, , % 8, , Hang Seng 23, , % 18, , Straits Times 3, , % 2, , FTSE 100 6, , % 4, , Source: Google finance

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