The Hindu Business Line : Kotak to close pvt fund with over Rs 300 cr

SIDBI has been a partner in the private equity venture, while USAID is expected to play a role in promoting the growth of emerging companies through the fund.

(From right) Mr Uday Kotak, Executive Vice-Chairman and Managing Director, Kotak Mahindra Bank; Mr K.V.S. Manian, Group Head; and Ms Shivani Atal Kapur, Dalhousie Branch Manager, addressing a press conference in Kolkata on Wednesday. — Parth Sanyal

Kolkata , Dec. 22

THE Kotak Mahindra group is set to close its newly launched private equity fund with commitments of over Rs 300 crore, much of which has been already secured.

The fund, which plans to conclude the exercise by early 2005, has initiated the process of identifying companies in which investments may be considered. The idea is to come up with a decent number of cases before such investments actually start rolling out.

The group had in October announced the launch of its private equity vehicle — India Growth Fund — in partnership with SEAF Management LLC, US. Mr Uday Kotak, Executive Vice-Chairman and Managing Director of Kotak Mahindra Bank, said the group has so far received commitments of roughly Rs 250 crore.

"We expect to wrap it up with about Rs 300 crore or so," he told reporters, adding that the fund is being managed by an experienced hand at venture capital, Mr Nitin Deshmukh.

The addition of private equity to the group's business portfolio is being seen as a move towards catering to a bigger market.

It may be mentioned here that SIDBI (Small Industries Development Bank of India) has been a partner in the private equity venture, while USAID (United States Agency for International Development) is expected to play a role in promoting the growth of emerging companies through the fund.

Kotak Mahindra, which has partnerships with Goldman Sachs (for investment banking), Ford Credit (auto finance) and Old Mutual (insurance), also plans to consolidate its existing businesses and invest more in such emerging ones as insurance and retail banking.

The insurance venture is expected to break even in about three years, while the bank hopes to scale up operations to cover more centres. The bank, which is now present in roughly 30 centres, plans to increase this number to one hundred in the foreseeable future. The Kotak Mahindra group will also unveil ambitious plans once real estate and commodity funds are allowed by the regulators, it is indicated.