In May 2008, word spread that CVCI India would lose Relan. Thanks to Relan and his team, Jindal Steel had proven a money spinner and so had Suzlon Energy and IVRCL. With such impressive track, it seemed a good idea to launch a new fund. And Relan did just that with CX Partners. Relan was said to have left behind close to $10 million in unrealised compensation. His peers can understand his sense of urgency. “When you are as old as Ajay is, you just want to get working on your next idea quickly. Money left behind is of little value,” says William Comfort, former head of CVCI.
...Within one month of leaving Citi, Relan had secured Morgan Creek Capital which decided to invest $100 million in CX Partners. Relan looked set to tap more investors. “Well, if there is one guy who can go out and raise some serious money then Ajay would have to be it,” Dhawan had said in August. Relan had both the taste and the vintage on offer. He had overseen the investment of more than a billion dollars into India and had investments such as i-flex, IVRCL, Suzlon and Sasken that had made lots of money for CVCI. But still, Relan’s target was ambitious: raising $1.1 billion. “That was the first thing that we changed after October,” says Relan. Once Lehman went bust on September 15, the financial sector imploded. “We knew $1 billion would be impossible so we changed the size to $750 million. We figured that with a 50 percent decline in corporate valuations, the new $750 million would be equivalent to the old $1 billion,” he says.
Even with that target, progress has been slow. Almost a year after he started the fund-raising, Relan has $220 million in capital commitments from seven financial institutions but his first close at $350 million is still a month away.
Arun Natarajan is the Founder & CEO of Venture Intelligence, the leading provider of data and analysis on private equity, venture capital and M&A deals in India. View free samples of Venture Intelligence newsletters and reports. Email the author at email@example.com