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April 18, 2016

Private Equity investments tick up 24% to $3.6 Billion in Q1’16

Quarter sees 12 Mega Deals ($100-M or more) across E-Comm; Financial Services; Healthcare & Infra
Private Equity firms invested about $3,620 million across 144 deals during the quarter ended March 2016, according to early data from the Venture Intelligence Private Equity Deals database, a research service focused on private company financials, transactions and their valuations. The investment amount was 24% higher than that invested in the same period last year ($2,922 million across 191 transactions) and 9% higher than the immediate previous quarter ($3,326 million across 152 transactions). Note: All figures in this note are exclusive of PE investments in Real Estate.
There were as many as 12 PE investments worth $100 million or more during Q1’16 compared to seven such transactions in the same period last year and ten during the immediate previous quarter, the Venture Intelligence analysis showed. The largest investment during Q1’16 was the estimated $350 million (INR 2,345 Cr) buyout of the commercial lending business of GE Capital in India by Aion Capital Partners in association with former GE Capital executives Pramod Bhasin and Anil Chawla. This was followed by Canada-based Fairfax's $321 million (INR 2,149 Cr) acquisition of the 33% stake held by the GVK Group in Bangalore International Airport.
Another Canada-based entity, Ontario Teachers Pension Plan, led a $200 million (INR 1,368 Cr) funding round for Snapdeal.com, which also facilitated an exit for some existing investors in the e-commerce firm. The next three largest transactions were also targeted at the online services/e-commerce sector: $150 million each for e-grocer BigBasket.com and payments processor Billdesk and a $145 million investment in auto classifieds firm CarTrade.
IT & ITES companies accounted for 34% of the value pie (attracting $1,222 million across 82 deals) during Q1’16, followed by BFSI (Banking, Financial Services and Insurance) companies at 26% (attracting $955 million across 12 deals). Led by the Abraaj Group’s $140 million buyout of Hyderabad-based Care Hospitals, Healthcare & Life Sciences companies (which attracted a total of $342 million across nine transactions) accounted for 9% of the investment pie.
Late Stage companies (including mature companies like Bangalore Airport, Snapdeal and Janalakshmi Financial) attracted 23 investments and accounted for 37% of the pie in terms of value during the period. Buyouts, led by the GE Capital and Care Hospitals transactions, accounted for as much as 24% of the PE investment pie (across 9 transactions) during Q1’16. Listed company investments (“PIPE” deals) accounted for 7% of the pie in value terms.  The 9 listed companies that attracted PE investments during the period was topped by the life insurance focused Max Financial Services (INR 950 crore or about $140 million from KKR) followed by retail focused Future Consumer Enterprise (about $45 million or INR 302 Cr from Black River).
The Venture Capital segment (defined as investments of up to $20 million in companies less than 10 years old) accounted for 85 of the PE transactions or 59% of volume pie during Q1’16 (7% by value). The VC investments of Q1’16 were dominated by follow-on rounds in companies like B2B group buying service for Power2SME ($20 million round led by Infosys co-founder Nandan Nilekani), food ordering service FreshMenu ($17 million from Zodius Capital and Lightspeed Ventures) and B2B marketplace firm cross-border enterprise software firm iCertis ($15 million round led by Eight Roads Ventures).
Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India. Click Here to Sign Up for the FREE Weekly Edition of the Deal Digest: India's First & Most Exhaustive Transactions Newsletter.