PE and VC firms raised $4.9 billion via India-focused funds in 2016

Industry:    December, 2016

Private equity (PE) and venture capital (VC) firms set new fund-raising milestones and raised a combined $4.9 billion in 2016 across 33 India-dedicated funds, according to research and analytics firm Venture Intelligence.

This was 9% more than the corresponding figure in 2015 when a total of $4.5 billion was raised by PE and VC firms across 27 deals.

The top five PE and VC funds in 2016 raised about $3.35 billion, up from $2.4 billion by the top five funds last year, Venture Intelligence data showed.

Here are the top five fund-raisers in 2016:

Brookfield-SBI stressed-asset JV ($1.04 bn)

Brookfield Asset Management Inc., Canada’s largest alternative asset manager, and State Bank of India (SBI), India’s largest lender, started a joint venture wherein the former agreed to invest Rs7,000 crore.

The fund has been launched to acquire distressed assets in India and independently evaluate and invest in various stressed assets. It will rely on the Canadian firm’s operational expertise to manage recapitalized businesses.

The fund will look at assets where stress is still in the initial stages, the firms said.

The time horizon for investments will be around four or five years on average and returns expected are in the range of 15% to 20%.

Sequoia Capital India Fund V ($920 mn)

Silicon Valley-based VC firm Sequoia Capital raised its new $920 million funds in February to invest in Indian start-ups as well as Southeast Asian companies.

The company was initially looking to raise around $800 million for its fifth fund.

In April 2015, Sequoia added $210 million more to its existing $530 million India-focused Fund IV.

Multiples PE Fund II ($690 mn)

Multiples Alternate Asset Management Pvt. Ltd, a PE fund led by Renuka Ramnath, marked the final close of its $690 million second India-focused fund, against an earlier target of $650 million.

The fund is one of the largest sector-agnostic private equity investment corpuses ever raised for India. The fund was raised through two vehicles—a core fund of $550 million and a co-investment pool of $135 million.

The firm made the first close of $325 million in early 2015. It made investments from the first fund in the range of $20 million to $25 million.

In April, International Finance Corp., an arm of World Bank, proposed to invest up to $40.6 million in the fund.

Accel India V ($450 mn)

VC firm Accel Partners, which has backed high-profile technology start-ups including Facebook Inc. and Flipkart, raised $450 million for its fifth India fund.

The latest fund is considerably larger than the $325 million Accel raised in its previous fund and will bring its assets under management in India to more than $1 billion.

Accel, which has enjoyed success in India over the past 12 years with early bets on startups such as Flipkart, Myntra and Mu Sigma Inc., said the fifth fund will be deployed in five broad areas: consumer Internet, enterprise software, financial technology, business-to-business and healthcare.

The company will begin to deploy the latest fund in early 2017.

Oman India Joint Investment Fund ($250 mn)

Oman India Joint Investment Fund (OIJIF), backed by Oman’s sovereign wealth fund State General Reserve Fund (SGRF) and SBI, hit the first close of $250 million for its second fund in May.

The first fund—which raised and invested $100 million in 2011—had not sought third-party capital and had been completely sponsored by SGRF and SBI.

The latest fund had a commitment of $200 million from the two sponsors, while the rest was raised from domestic and foreign institutional investors. The first close corpus has been mostly raised from domestic institutional investors.


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