Portfolio

Private equity

Updated on: Feb 12, 2011

Private equity activity in January has been rather sedate, with a marginal decline sequentially in aggregate investments. According to Ernst & Young Private Equity Flash Report, the month saw higher deal volumes, but a notable slowdown in exits. Even fund-raising remained sluggish, with no fund closure announcements made during the month. Here's a quick recap of the PE action for January 2011.

Investments

The total announced deals for the month aggregated to about $500 million (Rs 2,250 crore), 9 per cent lower than that reported in December 2010. It, however, is a good 32 per cent higher than what was reported in January 2010. Deal activity, however, remained healthy, with a 8 per cent increase in the number of deals over that reported in December 2010. The month saw 28 deals compared to 26 in December 2010. Deal volumes registered a 75 per cent growth over a year ago numbers (16 deals). In terms of deal value, infrastructure (47 per cent), media and entertainment (13 per cent) enjoyed the maximum share, while in terms of deal volume it was infra, retail and consumer products (6 each) that saw a high share. The largest deal for the month was that from Moser Baer Power Projects, which attracted $130 million (about Rs 585 crore) from Macquarie SBI Infrastructure Fund.

Fund Raising

Fund raising action, however, remained modest, with only four fund-raising announcements for a total of $2 billion (about Rs 9,000 crore) made in the month. Private equity major, KKR, announced the launch of its $1.5 billion India-focussed fund during the month. The fund, it said, may look at facilitating buyout deals in India.

PE Exits

Private equity exits fell to a six-month low in January 2011, with only four exits. These too were through the non-IPO route only, as exits through IPOs took a hit, driven largely by weak sentiments in the stock market. Ascent Capital's exit in Koutons Retail, Sequoia Capital India, Lightspeeed Ventures and Silicon Valley Bank's stake sale in TutorVista, ICICI Venture Funds sale of 10 per cent in VA Tech Wabag and General Atlantic's stake sale in Patni Computers were the exits.

Published on February 12, 2011

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