- 1. Four-S Private Equity TrackIssue: 19th - 25th March, 2012
Your Eye to Indian Private EquityPE activity for the week350.0302.5
16 During the week ended 25th March, 2012, there were 7 PE/VC
300.014 deals worth $35mn compared to 10 deals worth $302.5mn in
the12250.0 previous week.10200.0 7 8150.010 6 Out of the total,
there were 4 early stage deals and 1 deal each at100.04 Growth,
PIPE and SPV level. 35.050.0 20.00 In the largest deal during the
week, Parsvnath Developers raised Rs18th March1225th March12 1.2bn
($23.6mn) from Kotak Realty Fund for a township project in Gurgaon.
PE Investments No. of Deals Private Equity: Investment Summary
during the week Stake Value Investor (s)Target (%)($mn) Sector
Industry SegmentStage Parsvnath Developers Kotak Realty Fund
20.023.6Construction Real estateReal Estate SPV SPV Railway and
auto Frontline StrategyDTL Ancillaries
LimitedNA9ManufacturingAutomotiveGrowth component Prajay Engineers
CLSA 7.6 1.0Construction Real estateReal Estate PIPE Syndicate Pre
school and K- Omidyar Network Akshara Foundation NA1.0Services
EducationEarly 12 Hyderabad AngelsEdutor TechnologiesNA0.4Services
EducationContent Early Omidyar Network EnglishHelperNANA Services
EducationVocationalEarly Online retail - Angel Investors
AllSchoolStuff.com NANA Services Retail education Early Consortium
productsSource: Four-S PE DatabaseKotak Realty to invest Rs 1.2bn
in Parsvnath1.2-acre plot in the heart of Delhi, on Kasturba
GandhiDevelopersMarg, on the block and is expecting to raise around
7bnParsvnath Developers is raising Rs 1.2bn (~$23.6mn) fromthrough
the sale.Kotak Realty Fund for a new 100-acre integrated
townshipDebt servicing continues to remain the bete noire of
theproject on Sohna Road in Gurgaon. Kotak Realty fund willreal
estate sector. The net debt of Indias top 11 listed realget a 20%
stake in the special purpose vehicle. The project estate companies
at the end of December 2011 rose 14%will be largely residential in
nature with some commercialfrom a year ago to Rs 417bn. The real
estate players haveand retail developments, and will be launched in
the next been striving to reduce their debt by monetizing
non-coretwo months. assets. During the last quarter of 2011, DLF
raised Rs 12bnduring the quarter from the sale of non-core assets
like theFour-S Comment: Parsvnath Developers, which has a focus IT
Park in Noida and IT SEZ in Pune. Sobha Developerson the national
capital region, is currently trying to reduce reduced its debt in
the quarter by selling its land parcel inits debt, which stands at
around Rs 13bn. It recently put a Gurgaon.Indian Private Equity
Weekly Update19th 25th March, 2012
2. Railways component maker DTL Ancillaries raises$200mn in five
years. It has so far deployed $85mn across a$9mn portfolio of 24
companies in India, 70% of which are for-India Industrial Growth
Fund (IIGF), a private equity fund profit investments and the rest
grants to non-profitmanaged by Frontline Strategy Limited has
invested $9mnorganizations. In its bid to enhance employmentin DTL
Ancillaries, a customized roll forming company. The opportunities
in India through impact investing, OmidyarCompany is a leading
supplier of roll formed parts and Network also plans to support
rural business processfabrications to the Indian Railways recently,
it became aoutsourcing, agriculture and vocational training
projects.Part-I supplier to the Railways. It is also a leading
supplier, inits space, to the Indian automotive sector.Hyderabad
Angels invests Rs 20mn in Edutor TechnologiesCLSA acquires 7.63%
stake in Prajay EngineersEdutor Technologies has raised Rs 20mn
from group ofCLSA Mauritius Ltd has acquired 7.63% stake in
Hyderabad angel investors, Hyderabad Angels. The
Hyderabad-basedbased real estate company Prajay Engineers Syndicate
start-up develops and markets interactive learningLimited for $1mn
through open market transaction. CLSA platforms for touch devices
like Tablets PCs or iPads. TheirMauritius bought 5,336,134 shares
at a price of Rs 9.5 per solutions, for K12 students, are designed
to help improveshare Legatum Capital. Prajay Engineers Syndicate
Limitedtheir learning outcomes while aiding Educational
Institutesdevelops real estate in India through two segments-in
improving productivity and efficiency.Construction and Development
of Property and HospitalityHotels and Resorts.Four-S Comment: PE
investors continue to remain bullish on the Indian education
sector. India is the largestOmidyar Network backs two firms -
Aksharaeducation market in the world with approximately 540mn in
the 0-24 years age bracket. Education sector is the
largestFoundation and EnglishHelper services market in India with a
market size of $57bn perOmidyar Network, the philanthropic
investment firm annum (as of 2009). The government currently
spendscontrolled by eBay Inc. founder Pierre Omidyar, has about 4%
of GDP on education, which is planned to beinvested an undisclosed
amount in English language increased to 6% in the 11th Five Year
plan. Factors drivinglearnings solutions company EnglishHelper Inc.
and growth of this sector include demand-supply gap, higherextended
a three-year grant of $950,000 to Bangalore- spending by consumers,
increasing preference for privatebased public charitable trust
Akshara Foundation, which sector offerings and government reforms.
Hence, there isfocuses on elementary education. huge potential for
private investment in the sector.Akshara has developed a technology
platform, KarnatakaLearning Partnership, as a tool for non-profit
bodies,corporations, academic institutions and citizens to
getAllSchoolStuff raises funding from Angels Investorsinvolved in
improving government schools in Karnataka. ConsortiumEnglishHelper
offers a combination of English language Gurgaon based
AllSchoolStuff.com, online retail store for allreading and writing
technologies and has helped over school, learning and educational
needs has raised angel10,000 learners across the country.funding
from Angel Investors Consortium. The funds raised will be used for
setting up infrastructure, expanding theFour-S Comment: Omidyars
education portfolio in India has team, customer acquisition and
streamlining the supplynow expanded to five investments the other 3
include chain. AllSchoolStuff provides online stores for
students,Tree House, Anudip Foundation and Aspiring Minds parents,
teachers and schools to choose from a wide varietyAssessment.
Omidyar Network started funding projects inof branded, high quality
products to meet all theirIndia about two years ago with plans to
invest up to educational supplies needs. Indian Private Equity
Weekly Update 19th 25th March, 2012 3. company has been working on
restructuring its businesses, Fund Raising & Liquidity
Eventswhich is close to completion and sources in both firms
saidthey have reopened negotiations for an investment, whichcould
be as high as $100mn. The investment in Gitanjali isexpected to
help its brands, which have done well in India,to go global and
improve their image.Helion raises $255mn for third India VC
fundBlackstone Group, Bain Capital may buy outHelion Venture
Partners, an early-to-mid-stage ventureEuronets India ATM
businesscapital firm, has raised over $255mn for its third
fund,Private equity funds Blackstone and Bain Capital aretaking its
assets under management to $605mn. The new negotiating to buyout
the Automated Teller Machinesfund would probably make Helion the
largest venture business of Euronet Worldwide in India to benefit
fromcapital firm in India in terms of assets under
management.rising use of electronic transactions. The business,
whichThe Bangalore and Delhi-based VC has investments in
nearlyEuronet classifies under the so-called Electronic
Financialthree dozen startups, which includes
NASDAQ-listedTransaction segment, is facing profitability pressures
due toMakeMyTrip and legal process outsourcing firm UnitedLex
steady climb in costs. It is the biggest third-party operator
ofBPO. It had raised $140mn for its first fund in 2006, shares ATMs
across the nation. Euronet had in the past soldfollowed by another
$210mn in 2008. The new fund will a similar business in the UK to
Bridgepoint Capital forcontinue with early-to-mid-stage focus on
technology$30mn. The India business, where it operates more
thaninnovation and consumer demand-driven businesses. Helion1,300
ATMs, could be valued as high as $250mn.Venture Partners III will
look at deal sizes between $2-10mnand with an investment horizon of
5-7 years.Super Religare Laboratories in talks with privateequity
firms for stake sale Private Equity and M&A NewsTwo private
equity PE firms, including International FinanceCorporation, are
close to buying over 15-20% stake inMorgan Stanley Unit may invest
$200mn inIndias largest diagnostic chain Super Religare
LaboratoriesContinuum Energy(SRL) ahead of its planned public
issue. IFC has a tentativeA proprietary investment arm of Morgan
Stanley is inagreement to invest around Rs 1.25bn, while either
Jacobadvanced talks to invest about $200mn, roughly 10bn, forBallas
Capital or Qatar-based QInvest will invest Rs 1.5bn.51% stake in
Continuum Energy Pte Ltd (CEPL), a Singapore-The deal is expected
close in the next few weeks. The fundbased holding company
developing wind power assets in infusion will help the
privately-held company reduce itsIndia. Continuum Energy,
co-founded by former investmentdebt of about Rs 3bn that came with
the acquisition ofbanker Arvind Bansal and others, is a two
year-old start-up Piramal Diagnostics in 2010.which is building a
portfolio of wind farms throughacquisitions and green field
development. IFC to invest up to $24mn in IDFC
PE-backedDoshionGitanjali Gems, L Capital reopen investment talks
IFC, the private sector investment arm of World Bank, mayListed
jewellery firm Gitanjali Gems has revived talks with L invest up to
$24mn in IDFC Private Equity-backed waterCapital, the private
equity arm of the worlds largest luxury management company Doshion
Ltd through angroup LVMH, for a strategic investment. The two were
in equity/quasi-equity investment to finance expansion-negotiations
a year ago but talks had not progressed over related capital
expenditure, long-term working capital andthe structure of the
business. In the last one year, theupcoming
Build-Own-Operate-Transfer (BOOT)-based waterIndian Private Equity
Weekly Update19th 25th March, 2012 4. projects, cross-country
pipelines and other EPC projects.Executive trackingIFCs investment
will be at the corporate level and will beused to fund several
upcoming projects spread across India.Accels Prateek Dhawan to join
Everstone Capital Prateek Dhawan, Principal in Accel Partners
growth equityIFC to invest up to $20mn in Nereus Capitalsteam in
India, is joining Everstone Capital as a seniorCleantech Fund
member of the investment team. Dhawan will be based inIFC may
invest up to $20mn in Nereus India Alternative Everstones Mumbai
office. Dhawan joined Accels growthEnergy Fund LLC, a newly formed
fund which will target investment team from Goldman Sachs
Investment Partners,companies engaged in the development,
construction & where he was leading the funds private equity
investmentsoperation of renewable and clean energy generation
assetsin India. At Goldman Sachs Investment Partners, Dhawanor
those focused on the deployment of clean energy was responsible for
investments in Tikona Digital Networks,technologies in India. The
total target size of this fund is Bharti Infratel and Asian Genco.
Preceding Goldman,$250 million and it will be domiciled in
Mauritius. TheDhawan worked at Cisco Systems corporate
developmentanticipated portfolio of Nereus will include
7-10group.investments of $15-35mn each, in equity and
equity-linkedsecurities of companies primarily focusing on
theDonald DSouza to Head HDFC Bank ECMdevelopment, construction and
operation of power HDFC Bank has appointed Mr Donald DSouza as the
Headgeneration assets in India.of Equity Capital Markets in the
Investment Banking division. Mr DSouza will be reporting to Mr
Rakesh Singh, IPO, Other OfferingsHead of Investment Banking at
HDFC Bank. Mr DSouza will be responsible for building the equity
capital marketsHarisons Steel files for Rs 600mn IPObusiness that
includes origination and execution of capital-Harisons Steel
Limited has filed DRHP with SEBI to raise Rsraising mandates, said
a release from the company. Mr600mn through an IPO. The funds
raised will be used to set DSouza was the President of Investment
Banking at IIFLup rolling mill with a proposed capacity of 30,000
Mts p.a.prior to joining HDFC Bank. He has also served in Kotak,(Rs
415.9mn); to part finance incremental working capitalCLSA and J M
Financial, the release added.requirement (Rs 80mn) and for other
corporate purposes.Incorporated in 1999, Harisons Steel is engaged
in themanufacturing of stainless steel ingots and billets of
variousgrades and sizes.Alok Industries planning to raise
$150mnAlok Industries Limited is planning to raise $150mn
throughADR/GDR, QIP etc warrants for expansion. Recently
inFebruary, Caledonia Investments Plc, UK-based investmenttrust
company sold 2.08% stake in Alok Industries throughopen market
transactions for Rs 300-350mn. Alok Industries- founded in 1986 -
operates in four special business units ofinternational,
infrastructure, garment and domestic andretail businesses. It
manufactures home textiles, apparelfabrics and polyester yarns.
Indian Private Equity Weekly Update 19th 25th March, 2012 5.
M&A Activities During the week ended 26th March, 2012, there
were 9 M&A deals worth $40.4mn (size of 6 deals were not
known). In the biggest deal during the week, Australia-based PET
packaging supplier Amcor Ltd. has acquired Uniglobe Packaging
Private Ltd. for $20.7mn. Uniglobe produces flexible packaging for
the food, personal care, and health sectors.M&A Activity:
Summary during the weekStake Deal value ($AcquirerTargetTarget
business(%)mn)Amcor Uniglobe Packaging Private LimitedPackagingNA
20.7B Braun Ahlcon Parenterals (India) LtdPharmaceutical 2617Virgo
Valves and Controls Ltd -Thermax Ltd steam division and Rifox Hans
ManufacturingNA2.5Richter GmbHKEPCO Pioneer Gas Power Power 22.7
NAOscar Investments Ltd Voyages Ltd Aviation48.8 NAGruner + Jahr
Networkplay Media & Entertainment 50+NANaturex Valentine
AgroAgro NANAGeneral ElectricAdvanced Systek Private Limited
Engineering services NANANitco Limited New Vardhman
VitrifiedManufacturing-tiles51NA Source: Four-S Database,
Acquisition price is in $mnMarket UpdateKey Domestic IndicesIndian
Market Movements52 Week Index16-Mar-12 23-Mar-12 Change (%) HighLow
BSE Sensex 17,466.2017,361.74-0.60% 19,811.10 15,135.90 S&P CNX
Nifty 5,317.905,278.20 -0.75% 5,944.455,187.85 CNX Nifty Junior
10,324.5010,297.85-0.26% 11,758.15 10,176.30 Nifty Mid Cap
502,300.602,309.900.40% 2,657.102,274.75 CNX
IT6,501.256,532.150.47% 7,344.906,426.50 Bank Nifty
10,391.3510,294.55-0.94% 11,978.05 10,038.90 CNX
Infrastructure2,556.252,520.80 -1.41% 3,217.502,470.65 CNX
Realty242.00240.75 -0.52%344.05 234.55Source: BSE, NSE Key Global
Indices Global Market Movements52 WeekIndex16-Mar-12 23-Mar-12
Change (%) HighLowNASDAQ3,055.26 3,067.92 0.41% 3,090.082,298.89Dow
Jones Industrial Average 13,232.6213,080.73-1.16% 13,289.08
10,404.49S&P 500 1,404.17 1,397.11-0.51% 1,414.001,074.77NIKKEI
225 10,129.8310,011.47-1.18% 10,207.90 8,135.79Hang
Seng21,317.8520,668.80-3.14% 24,468.64 16,250.27Straits Times Index
3,010.68 2,990.08-0.69% 3,227.282,521.95FTSE 1005,965.58
5,854.89-1.89% 6,103.734,791.01Source: Yahoo Finance Indian Private
Equity Weekly Update 19th 25th March, 2012 6. About Four-S
ServicesFour-s is a boutique firm focusing on cutting-edge
Financial Research, Business Advisory and Investment Banking
services forclients. Through our deep research into Indias high
growth industries and accurate and objective advice we have helped
manymarquee institutional investors take informed investment
decisions in private equity and public markets. Four-S has
provensuccess in business advisory, investment banking and investor
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42153659 Indian Private Equity Weekly Update 19th 25th March,
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