Monday, June 18, 2007

Merill Lynch loses Sumeet Puri

Sumeet Puri resigned as head of equity capital markets in India at Merrill Lynch & Co., the biggest arranger of share sales in the nation, reported the Economic Times. Puri will leave Merrill by August after 13 years with the New York-based investment bank.

There have been no official statements as of now on this development from Merill Lynch and the reason for quitting, less than five months after he was named to run equities and origination of structured products in India, is not known yet.

Merrill's top executive in India, Amit Chandra, and its head of investment banking Munesh Khanna quit at the end of last year to start buyout funds.

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Merill invests US$ 11 mn in India's Copal Partners

Merrill Lynch completed a minority investment in KPO provider Copal Partners, joining Citigroup and Deutsche Bank as minority investors in the firm, reported . The three banks now collectively own around 25% of the business.

Based in the UK, Copal Partners is a leading KPO with approximately 550 employees based primarily in India and Mauritius. Copal is a leading outsourced research provider to Wall Street firms and the buy-side. The funding will be used for expansion organically and through acquisitions

According the WSJ, Copal is valued around $300 million, putting Merrill’s stake around 3.7%. The investment is a strategic one, in the sense that Merrill, like the other minority investors, relies heavily on outsourcing for its own research and other activities such as investment banking prep work.

Citigroup Venture Capital to invest a fresh $1.5 bn in India

Citigroup Venture Capital International (CVCI), Citi’s emerging markets private equity investment arm, will invest a fresh $1.5 billion in India over the next three years, reported the Mint. It will be the largest such infusion by a single private equity investor in the Indian market and outstrips the $1 billion allocations made by the Blackstone Group and Carlyle Group each in 2005.

The investments will be made out of CVCI’s global $4.5 billion Growth Partnership LP Fund II, which is slated to complete fund-raising in a few weeks. In three years, CVCI’s exposure to India will jump three-fold from the $500 million it has invested here so far.

The move to up the ante in India follows the recent reorganization of Citi’s global alternative assets businesses, namely hedge funds, private equity and real estate development, under Citi Alternative Investments (CAI), led by former Morgan Stanley executive Vikram Pandit.

CVCI stepped up its investments in India in 2005 soon after the launch of its $1.7 billion Growth Partnership LP Fund I. This fund, incidentally, was the first independent PE fund that CVCI raised since it started operations as a private equity investor in 1996. The bulk of the $500 million it has invested in India so far came from Fund I. Investments prior to 2005 were made mostly out of proprietary funds from Citi.

Among its notable investments pre-2005 were I-Flex Solutions Ltd in Mumbai, Progeon Ltd (now known as Infosys BPO) in Bangalore and Polaris Software Lab Ltd in Chennai.From the new fund, it will go after deals in cross-border outsourcing, consumer-driven industries, infrastructure and restructuring plays among others.

Barings is launching its third India dedicated fund

Baring Private Equity Partners India Ltd plans to launch its third India fund in the second half of 2007, with a corpus of at least $175 million (Rs717.5 crore) to target the energy and the knowledge process outsourcing (KPO) sectors, reported the Mint. The focus will be on alternative energy projects as they have a small gestation period and are comparatively smaller as compared to the conventional power projects.

Baring Private Equity Partners was founded in 1984 and has operations in Latin America, Europe, Russia, Asia and India. The company already has two funds operating in India with interests across sectors such as information technology, life sciences, financial services, energy and fast moving consumer goods.

Baring’s Indian operations started in 1997 with a $40 million fund and its second India fund of $175 million. Its two funds have invested in companies such as Mphasis BFL Software Ltd and Integra among others.

Yash Raj attracts PE interest

Yash Raj Films (YRF) is planning to enter the TV content and broadcast business and is in talks with private equity funds to raise money. A separate company may be created for the TV business.

YRF founder-promoter Yash Chopra has had talks with private equity investor Blackstone, the source adds. Among the other new initiatives, YRF is planning to get into the film exhibition business.

When queried about the TV business, Yash Raj Films chief executive Sanjeev Kohli said: "We are considering an entry into the TV space. We will be firming up our plans in the next few months." He did not rule out a presence in the broadcasting arena, but said no definite plans had been worked out yet.

Source: Indiantelevision.com
Related: Mickey Mouse meets loverboy Raj

Ascendas launches S$500m development fund for India

Business space provider Ascendas has launched its first ever development fund for India - to tap into the country's booming real estate sector. Totalling S$500 million, the private fund will invest in the development of integrated property projects like business and IT parks.

The new Ascendas India Development Trust will start by developing two IT business parks, in the Indian cities of Pune and Nagpur. Ascendas had announced in April that it was developing the two projects through joint ventures with Indian government agencies.

It plans to raise the total asset size of the fund to S$1 billion - and is in the process of securing new investment projects. Current investors in the fund include Bahrain-based asset manager Arcapita, and Holland's ING Private Banking

Source: Channel NewsAsia
Related Article: Singapore-based real estate firm Ascendas to raise $1 bn fund for India & China

Vineet Vohra to head ING India operations

ING Groep NV's (ING) investment management unit said Wednesday it appointed Vineet Vohra as chief executive of its India operations.

He will take over from Kavita Hurry, who has been chief executive since 2002 but is leaving ING to pursue other interests.

Vohra comes to ING from Citibank N.A., where he helped build the firm's wealth management franchise as regional director and business head for Citibank's Asia Pacific Consumer Investments business.

Vulture Funds investing in SMEs

There was an interesting article in the Economic Times on June 13, on how distressed assets funds (also called as Vulture funds) have been attracted to the SME segment in India. Over the past six months, funds specialising in distress assets like ADM, Clearwater, Citadel, Goldman Sachs Special Situations and DE Shaw have invested in such companies.

Spinnaker has invested in Spice Telecom and Clearwater in Sanghi Movers and earlier Diamond Cables. While Asia Debt Management (ADM) has invested in Rama Pulp and Paper, DE Shaw has invested Amar Ujala, Citadel in Aban Lloyd and Goldman Sachs has put in money in Cremica.

Both the SMEs as well as distress funds have their own motives to embrace each other. The SMEs may get funds for working capital from the banks, expansion capital is much more difficult. From a distress funds perspective, there are not enough distress opportunities considering the economy is growing at around 9%. Hence funds are forced to look outside their focus area

Read full article

NEA-IndoUS Ventures Fund invests in ISGN Technologies

ISGN Technologies Ltd, a software services firm servicing US funding from mortgage customers, has received $25 million (Rs102.5 crore) venture capital firm New Enterprise Associates (NEA) and an affiliate NEA-IndoUS Ventures Fund, a firm controlled by Vinod Dham, a former engineer who was part of the Intel team that designed the first Pentium chip.

The NEA firms declined to disclose financial terms but said they will pick up equity between 10% and 30% at ISGN. ISGN will use the investment to set up new offices and finance sales and marketing. The revenues of ISGN, backed by India’s K.K. Birla group of companies, as on March 2007 were $30 million. K.K. Birla is the chairman of HT Media Ltd

Firms from the outsourcing industry have attracted significant Private equity interest. Early this year, Adventity, a back office firm specialising in financial services, announced its first round of funding of $20 million from an investment to fund its domestic and oversees group led by Norwest Venture Partners expansion plans.

New Delhi-based Global Vantedge, that had carved a niche in the insurance recovery industry got strategic funding of around $8 million from private equity firm ChrysCapital in 2002, and was acquired by an Essar group call centre company in February 2007.

Indecomm Global Services Ltd, which provides financial services to its clients, received $5 million funding from West Bridge Capital Partners and Acer Venture Capital in 2003.

Source: Mint