Asia Buyouts - The Next M&A Growth Region

India’s largest engineering firm, Larsen & Toubro, plans $300 million private equity fund to invest in power

site1king — Sat, 01 May 2010 07:19:53 +0000

Larsen & Toubro Ltd., India’s largest engineering company, plans to create a $300 million private equity fund to invest in power, road projects in India, said N. Sivaraman, senior vice president for financial services reported Bloomberg. Larsen’s plan follows an investment by Morgan Stanley and a group of companies that invested in utility Asian Genco Pte in India’s biggest private equity transaction this year. Morgan Stanley Infrastructure Partners and a group of global investors will invest $425 million in Asian Genco, which is developing about 4,000 megawatts of hydro, thermal and wind power projects in India.

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Former MD of Reliance Money, Sudip Bandyopadhyay, starts finance company backed by CX Partners

site1king — Thu, 29 Apr 2010 07:15:19 +0000

Sudip Bandyopadhyay, former managing director of Indian billionaire Anil Ambani’s Reliance Money, has started a financial services company backed by private equity firm CX Partners. Bandyopadhyay’s Convexity will offer equity broking and portfolio advisory services with a focus on derivatives, according to an e-mailed statement recently as reported by Bloomberg. Bandyopadhyay quit Reliance Money and joined Spice Group to head its financial services business in November.

CX Partners, a $500 million buyout fund whose investors include Goldman Sachs Group Inc. and JPMorgan Chase & Co., will name two people to Convexity’s board, according to the statement. The fund is managed by Ajay Relan, a former managing director of Citigroup Inc.’s private equity arm in India.

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TPG-Owned China Grand Auto said to plan $1 billion stock offer

site1king — Tue, 27 Apr 2010 07:00:36 +0000

China Grand Automotive Group, a car dealer part-owned by private equity firm TPG Inc., hired Goldman Sachs Group Inc. and China International Capital Corp. for an initial stock sale, said sources as reported by Bloomberg. China Grand Automotive may sell about $1 billion of shares as early as this year, probably in Hong Kong, said one of the people, who declined to be identified because the information is private.

China Grand Automotive was founded in 2006 as a 3 billion yuan ($439 million) venture between TPG and Xinjiang Guanghui Industry Investment (Group) Co., according to a job posting on Web site Alljobsearch.cn. It operates more than 100 car dealerships in the country, according to a statement in December.

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Carlyle Group raises $2.55 billion for third Asian private equity fund

site1king — Sun, 25 Apr 2010 06:56:40 +0000

Carlyle Group, the world’s second- largest private-equity firm, raised $2.55 billion for its third fund aimed at deals in Asia. Carlyle Asia Partners III brings the total committed for investments in the region by Carlyle to $5 billion, the Washington-based firm said in a statement recently as reported by Bloomberg. “We believe that 2010 is shaping up to be a very good year to make investments in Asia as the region bounces back strongly from the global economic crises,” X.D. Yang, co-head of Carlyle Asia Partners, said in the release.

Carlyle Asia Partners funds have made 21 investments in the region, where the company set up private-equity operations in 1999. With $88.6 billion in assets under management, Carlyle trails only New York-based Blackstone Group LP by that measure.

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Europe’s Investindustrial opens China office for expansion

site1king — Fri, 23 Apr 2010 09:43:04 +0000

Investindustrial SpA, a European buyout firm, opened its Asian head office in Shanghai recently, aiming to tap into China’s growing desire for luxury goods reported Bloomberg. The office will have six employees, who will provide support to the company’s eight manufacturing, distribution and retailing companies in China, Chairman Andrea Bonomi said. Investindustrial plans to increase the number of companies in China to 10, helping to boost sales in the nation to $1 billion from $600 million “fairly quickly,” he said.

Investindustrial, based in Italy and Spain, is expanding in Asia through luxury brands such as Ducati motorcycles and jewelry sales as growth slows in Europe, Bonomi said. “Eventually our goal is to IPO,” he said in a phone interview. “It would be either in China or Hong Kong or Singapore.”

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Blackstone Group is investing $50 million in the owner of an Indian newspaper

site1king — Wed, 21 Apr 2010 09:38:03 +0000

Blackstone Group LP, the largest private-equity firm, plans to invest 2.25 billion rupees ($50 million) in the owner of Dainik Jagran, the Hindi-language broadsheet that says it’s the world’s most widely read newspaper reported Bloomberg. The New York-based firm is investing in Jagran Media Network Pvt., which holds a majority stake in Indian newspaper publisher Jagran Prakashan Ltd., as local-language publications are poised to grow.

Dainik Jagran has 54.6 million readers and prints 37 editions and more than 200 sub-editions across 11 states, according to a joint statement by Blackstone and Jagran Media.

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Red Fort Capital plans to invest up to $1 billion in India real estate

site1king — Mon, 19 Apr 2010 09:33:14 +0000

Red Fort Capital Advisors Pvt., a real estate private equity fund, plans to invest as much as $1 billion in India’s property market over the next few years to tap demand in the world’s second-fastest growing major economy reported Bloomberg. The firm has invested $400 million since 2007, mainly in residential projects, and may consider investing in offices, hotels and shopping malls, Managing Director Subhash Bedi said in an interview in Mumbai yesterday.

Demand for homes is picking up and Red Fort and its partners have sold 3,000 apartments over the last six months in New Delhi, Bangalore and Chennai, Bedi said. Red Fort has invested in projects with Parsvnath Developers Ltd. in the New Delhi area, and with closely held Prestige Group in Bangalore, he said.

“In India, there’s a growing middle class whose incomes are rising, the economy is consumption-led, investments come from high domestic savings and it’s a growing economy,” said Bedi. “Mortgage penetration rate is miniscule and as the penetration rate increases, more Indians will be buying homes.”

Red Fort Capital has returned an average 25 percent to its investors in each of the past three years, he said.

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Red Fort Capital Advisors Pvt., a real estate private equity fund, plans to invest as much as $1 billion in India’s property market over the next few years to tap demand in the world’s second-fastest growing major economy.The firm has invested $400 million since 2007, mainly in residential projects, and may consider investing in offices, hotels and shopping malls, Managing Director Subhash Bedi said in an interview in Mumbai yesterday.

Demand for homes is picking up and Red Fort and its partners have sold 3,000 apartments over the last six months in New Delhi, Bangalore and Chennai, Bedi said. Red Fort has invested in projects with Parsvnath Developers Ltd. in the New Delhi area, and with closely held Prestige Group in Bangalore, he said.

Red Fort Capital has returned an average 25 percent to its investors in each of the past three years, he said.

Babson Capital Management to expand mezzanine finance unit in Asia-Pacific region

site1king — Sat, 17 Apr 2010 09:22:59 +0000

Babson Capital Management LLC, which oversees $118 billion in assets, will expand its mezzanine debt and private-equity investment unit in the Asia-Pacific region with an eight-member team reported Bloomberg. The unit, created in 1992, currently has a staff of 21 people and manages about $5 billion in the U.S.

“The Asia-Pacific region offers attractive opportunities for profitable mezzanine investing due to the region’s strong economic outlook, increasing demand for mezzanine as a source of buyout financing, and a pullback by traditional investors in the marketplace as a result of the global financial crisis,” Michael P. Hermsen, a managing director who co-heads the mezzanine and private equity group, said in the statement. He will oversee the Asia-Pacific team.

The team added Shane A. Forster and Adam H. Wheeler, previously of AMP Capital Investors, where they managed more than A$700 million ($643 million), according to the statement. Joining them in Sydney are Elliott Wong and Adrian Ng, who headed a A$200 million mezzanine debt portfolio Babson took over management from Babcock & Brown.

Hermsen’s team will also include Los Angeles-based Benjamin Silver and Asia-based Adam Nowak and Howe Wu, according to the statement.

Mezzanine financing, common in takeovers, usually involves preferred stock or unsecured subordinated debt to expand a company’s equity capital. The debt is senior to common stock and junior in the capital structure.

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KKR-led consortium to invest over $200 million in India’s Coffee Day Resorts

site1king — Thu, 15 Apr 2010 09:15:09 +0000

A group of private equity firms led by Kohlberg Kravis Roberts (KKR) is in the final stages of investing around Rs 1,000 crore (over $200 million) in Coffee Day Resorts — a company owned by VG Siddhartha, a serial entrepreneur and son-in-law of foreign minister SM Krishna — the largest investments by private equity in an unlisted firm in recent times reported the Economic Times.

The PE firms KKR, New Silk Route and Standard Chartered Private Equity are likely to end with an ownership of more than 20% in Coffee Day Resorts, which performs the role of a holding company besides running a host of businesses like resorts and IT parks apart from Café Coffee Day, the coffee chain, confirmed two people close to the transaction.

This fund-raising exercise — once concluded — will value the company between $800 million and $1 billion. KKR is likely to own over 10% of the unlisted company and invest between $75 million and $100 million, NSR is likely to invest between $50 million and $75 million, while StanChart will invest around $50 million. Cafe Coffee Day, a subsidiary of Coffee Day Resorts, plans to use some of this cash to increase the number of retail outlets and also speedily add international locations to its small portfolio in Austria, Pakistan and Dubai.

Cafe Coffee Day is hoping to have 2,000 coffee bars in place over the next few years. It currently operates 850 coffee selling outlets spread across 110 cities.

The holding company, Coffee Day Resorts, is likely to use some of the money to grow its resort business down south where it runs semi-luxury resorts in Chikmanglur and in and around Mangalore. Mr Sidhartha will also go beyond the coffee story and utilise some of the funds from the PE consortium in its small but growing brokerage business called Way2Wealth. Way2Wealth, headquartered in Bangalore, offers equity and investments services and claims to have 1,000 wealth managers and 100 city touch points to take its business ahead.This is KKR’s fourth investment after Aricent (formerly Flextronics), a minority stake in Bharti Infratel, and a small investment in Analjit’s Max India.

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CIC sees opportunity for private equity investment

www.asiabuyouts.com — Tue, 13 Apr 2010 09:12:20 +0000

China Investment Corp., China’s $300 billion sovereign wealth fund, sees a “good opportunity” to boost private-equity investments this year, as companies are undervalued after losses from the global financial crisis reported Bloomberg. “A lot of companies’ valuations are relatively low currently, and investors of many private-equity funds don’t have money to invest,” China Investment Corp. Executive Vice President Jesse Wang said in an interview with the official Xinhua News Agency today that was broadcast online.

CIC had “double-digit” returns from its overseas portfolio last year, Wang said, without being specific. The company increased spending on energy and minerals assets in 2009 to profit from the global economic recovery, announcing almost $10 billion of investments in commodity-related companies.

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