Four-S Services Private Equity Track by Foursservices


									Four-S Private Equity Track…
Issue: 30th April – 6th May, 2012                                            ……       Your Eye to Indian Private Equity
  PE activity for the week
                                                                                 250.0                                                                   16
     During the week ended 6th May, 2012, there were 6 PE/VC deals
     worth $87.5mn compared to 11 deals worth $154.9mn in the                    200.0            154.9
     previous week.
                                                                                 150.0                                                                   10
                                                                                                       11                         87.5                   8
     Out of the total, there were 2 early stage deals, 2 late stage deals        100.0                                                                   6
     and 1 deal each at growth stage and PIPE level.                                                                                                     4
                                                                                  50.0                                              6
     In the largest deal during the week, PE firm Jacob Ballas Capital has            0.0                                                                0
     invested Rs 2bn (~$39mn) to pick an undisclosed minority stake in                         29th April'12                   6th May'12

     Marg Karaikal Port Pvt Ltd.
                                                                                                         PE Investments          No. of Deals
   Private Equity: Investment Summary during the week
                                                         Stake     Value
     Investor (s)            Target                       (%)      ($mn)     Sector           Industry             Segment                      Stage
     Jacob Ballas Capital    Marg Karaikal Port Pvt       NA       39.0      Construction     & Allied             Port                          Late
     BCCL                    Pantaloon Retail             3.7      37.6      Services         Retail               Diversified                   PIPE
     TVS Capital and                                                                                               Non electrical
                             ReGen Powertech              2.7       9.9      Manufacturing    Capital Goods                                      Late
     MCap                                                                                                          machinery
                                                                                                                   Software &
     India Angel Network     OrangeScape                  NA        1.0      Services         IT/ITeS                                            Early
                             Innoz Technologies Pvt
     Seedfund                                             NA        NA       Services         IT/ITeS              M Vas                         Early
     Rajasthan Venture                                                                        Health
                             Frontier Lifeline Pvt Ltd   11.0       NA       Services                              Hospitals                    Growth
     Capital Fund                                                                             Services
    Source: Four-S PE Database
                                                                               Equity's India Infrastructure Fund invested Rs 1.5bn in
  Jacob Ballas Capital invests in Marg Karaikal Port                           March 2010. Thus the latest round of funding takes the total
  Jacob Ballas Capital has invested Rs 2bn (~$39mn) to pick an                 PE investment in the firm to over Rs 5.5bn of a little over
  undisclosed minority stake in Marg Karaikal Port Pvt Ltd,                    $100mn.
  which is developing a port in India's south east coast in
  Puducherry. Marg Karaikal Port will use the funds for                        BCCL invests in Pantaloon Retail
  expansion plans to increase port’s capacity from 21 MMTPA                    Bennett Coleman is investing Rs 2bn for a 3.68% stake in
  to 28 MMTPA. Marg Karaikal Port will have a total of 9                       Pantaloon Retail. After the transaction, Bennett's stake in
  berths (5 already developed) capable of handling up to 47                    the company will go up from 2.12% to 5.8% while
  MMTPA when fully developed.                                                  promoters stake will come down by 1.6% to 43%. Pantaloon
                                                                               will issue 8.16 million shares to Benett Coleman at Rs 245
  Four-S Comment: This is Marg Karaikal Port’s third fund                      on a preferential basis.
  raising from private equity investors. In 2011, Ascent Capital
  invested Rs 2bn in the company giving Marg Karaikal a pre-                   Four-S Comment: The deal comes immediately after Aditya
  money valuation of Rs 13.3bn. Prior to that IDFC Project                     Birla Nuvo Ltd (ABNL), a unit of the $28bn Aditya Birla

                                                                                               Indian Private Equity Weekly Update
                                                                                               30th April – 6th May, 2012
Group, announced that it will acquire a majority stake in the    traffic. Innoz’s mobile query product SMSGyan (now
Pantaloons retail chain of debt-laden Pantaloon Retail           rebranded) works on a short code ‘55444’, giving instant
(India) Ltd. The proposed transaction will help the Future       results on queries through an SMS. The company offers this
Group’s PRIL pare debt, which has been accumulated by            service at Re 1 per query and has packages for daily and
rapid expansion and is likely to be completed within 8-10        monthly unlimited queries. The company which currently
months. The new, separated unit will eventually become a         claims to handle 1 million query every day, aims to hit 10
subsidiary of ABNL. The separation will help PRIL, which had     million query per day by end of 2015. Additionally, it plans
debt of Rs. 58bn as of December 2011, reduce this amount         to get 1 million unique users everyday compared to the
by Rs. 16bn.                                                     current 2.5 lakh.

TVS Capital, Summit invest in ReGen Powertech                    Rajasthan Venture Capital picks 11% in Frontier
ReGen Powertech, a Chennai-based wind turbine maker,             Lifeline
has raised Rs 520mn from TVS Capital and Summit FVCI - a         Rajasthan Venture Capital Fund (RVCF) has acquired 11%
fund advised and managed by MCap. TVS Capital has                equity stake in Chennai-based Frontier Lifeline Pvt Ltd for an
invested Rs 370mn for a 1.95% stake while Summit has             undisclosed amount. RVCF has invested in this company
invested Rs 150mn in the company valuing ReGen at Rs             through its Rs 200 crore SME Tech Fund. The funding will
18.5bn. M Cap, through Summit, will now hold around 3% in        enable Frontier Lifeline to finance its medicity project
ReGen Powertech. The funds will be used for expanding its        'Frontier Mediville' in Tamil Nadu. The project is expected to
manufacturing capacity at its Udaipur plant, as well as for      be operational within one or two months. Frontier Mediville
project development.                                             includes a research and training centre and an animal
The latest capital infusion is an extension of the round of      laboratory to house clinical research organisation (CRO).
funding that the company did in December 2011, and               The company had raised Rs 900mn from State Bank of India
extending to January 2012. IDFC Private Equity and M Cap         and Bank of Baroda for the first phase of the project and
Advisors had invested Rs 1bn in that period, a transaction       scooped around Rs 5bn from private equity players in its
that valued ReGen at Rs 16bn.                                    second phase.

OrangeScape raises $1mn angel funding from IAN
                                                                  Fund Raising & Liquidity Events
Chennai-headquartered OrangeScape, a cross-Cloud PaaS
(Platform-as-a-service) provider, has raised $1mn from the
Indian Angel Network. The capital raised will be largely used
for business and product development. Founded in 2003 by
Suresh Sambandam and Mani Doraisamy, OrangeScape has
operations in India, North America and Western Europe/UK.
The company currently employs 55 people across its India
                                                                 IndiaCo hits first & final close for twin funds
and the US offices. By the end of 2012, it intends to scale up
                                                                 Domestic private equity fund house, IndiaCo Ventures Ltd.
the team strength to 70-80.
                                                                 has announced first close of its India Growth Opportunities
                                                                 Fund and final close of India Amalgamation Fund. The India
Innoz raises Series A funding from Seedfund                      Amalgamation Fund has been fully capitalised with Rs
Innoz Technologies Pvt Ltd, a mobile search platform, has        280mn and the India Growth Opportunities Fund which has
secured Series A funding from Seedfund. The funding will be      a target size of Rs 400mn has seen its first close at Rs
used in marketing, hiring people and strengthening the           150mn. So far, the company has been investing through its
technology base to support the increase in demand and

                                                                           Indian Private Equity Weekly Update
                                                                           30th April – 6th May, 2012
balance sheet and has now decided to carve out the                 Capital) and LGT Venture Philanthropy are expected to
investments into two separate small funds.                         participate in this round. The company provides power to
As on date the company has a total investment portfolio of         off-grid consumers in rural India, chiefly in the state of
Rs 600mn with investments in more than half a dozen                Bihar, by setting up 35-100 kilowatt power plants. The
companies. India Amalgamation Fund and India Growth                plants generate power by burning rice husk, a waste
Opportunities Fund will chase investments in manufacturing         product of rice milling. It set up the first plant in Tamkuha
and domestic consumption space in India.                           village in Bihar’s West Champaran district and has since
                                                                   installed 85 plants. Out of those, 80 are installed within
                                                                   Bihar, two in Nepal and three in Uttar Pradesh. The
 Private Equity and M&A News                                       company needs additional funds at this stage to get to its
                                                                   stated target of over 2,000 plants by 2014.
Speciality retail chain Mom & Me in talks to raise
PE funding                                                         Navis Capital may invest in Twilight Litaka Pharma
Mahindra Retail, which houses Mom & Me – the speciality            Navis Capital Partnes is planning to invest Rs 1.5bn in
retail venture of the diversified Mahindra Group – is in talks     Mumbai based Twilight Litaka Pharma Limited. Incorporated
to raise Rs 1bn ($18.8mn) in funding from private equity           in 1994 by Rajendra Bora, Twilight Litaka Pharma
investors. Mom & Me caters to the baby care segment in             manufactures and sells drugs and formulations in the form
the organised retail market. It has about 50 stores across         of tablets, capsules, ointments, and liquids. It exports its
the country, offering baby apparel & accessories, travel and       products over 40 countries across Africa, South America,
safety products, baby furniture, toys, etc. It is now raising      South East and Central Asia. It also provides contract
money to open more stores and expand the product                   manufacturing services on principal to principal or on loan
offerings. The retail chain is also looking to expand to tier II   license basis for various companies.
and tier III cities via franchise model.
                                                                   IFC may invest in MAS Financial Services
IFC to invest in Zephyr Peacock-backed Flareum                     IFC may invest upto $12mn in Ahemadabad based NBFC -
International Finance Corporation (IFC) is planning to invest      MAS Financial Services Limited. The company may also raise
$1mn in a Mumbai-based solar energy firm Flareum Solar             another Rs 500mn of Tier II capital over the medium term.
Technologies Pvt Ltd. The investment is being routed               The funds will be used to expand it's capital base and it's
through a special purpose vehicle (SPV) set up by Zephyr           operations. MAS Financial (formerly, Marketing & Allied
Peacock India Fund for its existing investment in Flareum.         Services) was initially engaged in consumer durable
PE firm Zephyr Peacock had invested around Rs 500mn to             financing. The company was registered as an NBFC in 1995.
pick a significant minority stake in Flareum Technologies          The company is currently engaged in retail asset lending
(formerly known as Gadhia Solar Energy Systems Pvt. Ltd.)          (financing of two-wheelers, three-wheelers, small CVs, and
few months ago. The solar energy company provides energy           small-ticket business loans under the individual micro-loans
solutions by using parabolic concentrated technology. The          module).
company provides products and services in the solar
thermal space used in cooking and cooling applications.            Trivitron to raise $100mn from PEs
                                                                   Promoters of India's largest home-bred medical diagnostic
Husk Power System to raise Series A funding                        equipment company, Trivitron Healthcare, will sell more
Renewable Energy firm Husk Power Systems is raising $5-            stake in the company to raise $100mn from private equity
10mn Series A funding from existing and new investors.             funds to purchase cardiology imaging companies and
Existing investors Acumen Fund, Bamboo Finance (Oasis              expand its manufacturing park in Chennai. It has appointed

                                                                             Indian Private Equity Weekly Update
                                                                             30th April – 6th May, 2012
investment banker Kotak Mahindra Bank to value the                bank raised Rs 7.2bn from India’s largest mortgage lender
Chennai-based company. HSBC Private Equity and ePlanet            HDFC Ltd and a consortium of private equity investors
Capital, which had purchased 20% stake in Trivitron in 2007       including Norwest Venture Partners, Beacon India Private
for roughly $11mn, are now looking to exit.                       Equity Fund and others.

Blackstone, KKR may buy Mallya's UB Towers for Rs                 HDFC Life to go for IPO in FY14
6.5bn                                                             HDFC Life plans to raise funds through an initial public
Beleaguered billionaire Vijay Mallya's UB Holdings Ltd is in      offering (IPO) of 10% of the capital base. The private-sector
talks with Blackstone and Kohlberg Kravis Roberts (KKR) to        life insurer has already started the process internally, and is
unlock the value of its office spaces, including the iconic       expected to hit the market in the next financial year. The
head office, UB Tower. One of these two PE investors may          company has posted a net profit of Rs 2.71bn, for the first
acquire Mallya's office real estate, a part of UB City, through   time since its inception. HDFC Life is a joint venture
a structured equity deal for roughly Rs 6.5bn. UB Holdings is     between Housing Development Finance Corporation (HDFC)
the parent of the debt-laden Kingfisher Airlines.                 Ltd and UK-based insurer, Standard Life.

Apollo Hospitals to raise $60mn from IFC                          Plastene India IPO begins on May 9
Apollo Hospitals Enterprise Ltd (AHEL) is planning to spend       Flexible intermediate bulk container (FIBC) maker Plastene
$394mn over four years for adding 2,900 beds to its               India Ltd has said it is entering the capital market with a
hospitals network and equipment purchases for existing            public issue of 92.55 lakh equity shares through a 100%
hospitals. It is also planning to establish presence through      book building route on May 9. The shares will be of face
clinics, information centres and telemedicine centres in          value of Rs 10 each for cash in the price band of Rs 81-Rs 84.
Uganda and Tanzania. The hospital network is raising funds        The proposed issue will open for subscription on May 9 and
of about $60mn from International Finance Corporation             close on May 15. The Ahmedabad-based company is
(IFC) to support future investments.                              engaged in the integrated business of manufacturing jumbo
                                                                  bags, flexible packaging, BoPP laminated woven sacks and
Machdar Motorsports to raise Rs 2bn PE funding                    multi-filament yarns.
Machdar Motorsports, the promoters of i1Super Series
Championship, are understood to be in talks to raise close         Executive Tracking
to Rs 2bn through the private equity route to kickstart the
championship by early next year. The i1 Super Series, based
on the popular city-based franchisee format, has nine teams       Partners Group hires Cyrus Driver for direct
representing nine cities in India.                                investments
                                                                  Partners Group, the Switzerland-based private market
 IPO, Other Offerings                                             investment manager, has roped in Cyrus Driver to
                                                                  strengthen direct investment activities in India. Driver, who
Ratnakar Bank IPO in 2 years                                      will join as a managing director based out of Singapore,
Kolhapur-based Ratnakar Bank is looking at an initial public      earlier headed Helix Investments after which he joined Arka
offering (IPO) in two years. The bank expects to double its       Capital. Driver has over a decade of experience in the Indian
loan book by then. The loan book of the bank had grown            private equity market. He lead India investments for PE firm
from around Rs 10bn at the time of the launch of Vision           Helix before which he was with J.P. Morgan Partners
2015 about 18 months ago, to around Rs 25bn. Last year the        Advisors in Singapore and Mumbai.

                                                                            Indian Private Equity Weekly Update
                                                                            30th April – 6th May, 2012
M&A Activities

                           During the week ended 6th May, 2012, there were 5 M&A deals worth $401.5mn
                           (size of 1 deal was not known). In the largest deal during the week, France based Roquette Freres has
                           acquired Starch business of Riddhi Siddhi Gluco Biols Limited for $181mn.

M&A Activity: Summary during the week
                                                                                                             Stake   Deal value ($
 Acquirer                              Target                               Target business                   (%)        mn)
                                       Riddhi Siddhi Gluco Biols - starch
 Roquette Freres                                                            Manufacturing - starch            NA         180.9
 Aditya Birla Nuvo                     Pantaloon Retail                     Retail                            NA         152.0
 Wipro Limited                         Promax Applications Group            IT/ITeS                           NA            36.4
 Life Insurance Corporation            Pipavav Defence and Offshore         Defence                           0.6           32.2
 EFS Facilities Services               Dalkia India                         Facility management               NA            NA

Source: Four-S Database, Acquisition price is in $mn

                                                                                      Indian Private Equity Weekly Update
                                                                                      30th April – 6th May, 2012
Market Update

Key Domestic Indices
                        Indian Market Movements                           52 Week
Index                             27-Apr-12   4-May-12 Change (%) High        Low
BSE Sensex                        17,134.25  16,831.08       -1.80% 19,619.65 15,135.86
S&P CNX Nifty                      5,190.60    5,086.85      -2.04% 5,740.40    4,990.30
CNX Nifty Junior                  10,103.30    9,948.00      -1.56% 11,550.00   9,749.30
Nifty Mid Cap 50                   2,168.45    2,123.65      -2.11% 2,525.75    2,067.55
CNX IT                             5,940.35    6,100.35       2.62% 6,835.25    5,957.30
Bank Nifty                        10,148.70    9,802.35      -3.53% 11,451.25   9,480.50
CNX Infrastructure                 2,341.45    2,260.70      -3.57% 3,191.60    2,213.65
CNX Realty                           221.80      216.80      -2.31%    302.20     208.50
Source: BSE, NSE

Key Global Indices
                        Global Market Movements                               52 Week
 Index                            27-Apr-12   4-May-12 Change (%)     High        Low
 NASDAQ                            3,050.61   2,956.34       -3.19%      3,134.17   2,298.89
 Dow Jones Industrial Average     13,204.62  13,038.27       -1.28%    13,338.66 10,404.49
 S&P 500                           1,399.98   1,369.10       -2.26%      1,422.38   1,074.77
 NIKKEI 225                        9,520.89   9,380.25       -1.50%    10,255.20    8,135.79
 Hang Seng                        20,741.45  21,086.00        1.63%    23,707.95 16,250.27
 Straits Times Index               2,981.58   2,990.59        0.30%      3,227.28   2,521.95
 FTSE 100                          5,777.11   5,655.06       -2.16%      6,084.08   4,791.01

Source: Yahoo Finance

                                                                                Indian Private Equity Weekly Update
                                                                                30th April – 6th May, 2012
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                                                                                        Indian Private Equity Weekly Update
                                                                                        30th April – 6th May, 2012

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