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Showing posts from July, 2016

PE-Backed IPO Analysis: Advanced Enzymes

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.


First time Fund managers: Mint

A Mint article quotes Venture Intelligence data from our Funds Database, covering first-time fund managers in the market:

Trends quoted in the article:
1. First-time fund managers are wooing LPs as anchor investors by offering them sweeter deals -  fee or carry discount.
2. LPs look un-favourably on team breakouts. When partner-level fund managers walk out of established firms, it reflects poorly on all parties.
3. Separately-managed accounts, mandates established by a single LP and one investment manager are on the rise.
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.

PE realty funds flock to residential projects: Business Standard

A Business Standard article quotes Venture Intelligence data on Real Estate investments in India. According to Chennai-based PE investment data provider Venture Intelligence, PE funds invested $1,047 million in residential real estate across 24 deals in the first six months of the year, against $221 million invested in commercial properties across two transactions. Last year, PE funds invested $2,936 million in residential real estate across 61 deals, against eight transactions worth $979 million for commercial real estate. In the previous two years, PE investments in commercial properties were higher at $717 million (2014) and $991 million (2013) against investment in residential real estate at $671 million and $429 million, respectively.

"In the first wave of PE investments in real estate in India, global investors burnt their fingers with equity investments in residential projects here," says Arun Natarajan, founder and CEO at Venture Intelligence. "This saw domesti…

Is the Spike in Bridge Rounds Bad News?

July has already seen 6 start-ups reporting bridge rounds - marking a spike in the number of such deals in recent months. The list of companies includes MyTaxiIndia ($1 M from Nihon Kotsu), Quickli (AVG Group & 500 Startups), and AppsDaily ($2 M from Kalaari Capital, Qualcomm Ventures, etc).
What qualifies as a Bridge round?
A bridge round is typically one where the company raises a sum smaller amount of funding than during its previous round. The investors in the round are also typically existing investors who have chosen to extend the company "extra runway".
The following table - extracted from a post on Bridge Rounds by US VC Paul Martino - provides the highlights of such a round:



Most of the recent Bridge Rounds in India are taking place either between the Seed and Series A or between the Series A and Series B stages.
Is the Spike in Bridge Rounds a Cause for Worry?
Not Really. While it is quite clear that providers of follow-on funding have become choosier,  the fact…

Can Flipkart & Snapdeal do a Yatra?

Will SPACs emerge as an Alternative Exit Route?
After 10 years of raising over $100 million from Private Equity & Venture Capital Investors, Yatra.com is to now get listed on NASDAQ through a merger with Terrapin 3 - which basically does "nothing", other than being listed on NASDAQ that is.
What is Terrapin 3?
Terrapin 3 is a "SPAC" (Special Purpose Acquisition Company) or a "Blank Check" company, which according to the US SEC, "..has indicated its business plan is to engage in a merger or acquisition with an unidentified company or companies (within a set time frame)." A SPAC is one where investors' are betting on the jockey (i.e. the management) and not the horse (because there is no horse).*
Terrapin 3 is founded by Nathan Leight,(who has successfully created two previous blank-check companies) and sponsored by Terrapin Partners and Macquarie Group. Terrapin 3 raised over $212 Million via a IPO in July 2014. Terrapin 3 had twenty four …

Spark Capital advises CORONA on its USD 17.5 Mn Funding from Creador

Spark Capital is pleased to announce the successful closure of a USD 17.5 Mn investment in CORONA Remedies Pvt. Ltd. (“CORONA”), one of the fastest growing domestic pharmaceutical companies in India, by Creador, a private equity firm focused on long-term investments in growth-orientated businesses in Indonesia, India and Malaysia. Spark Capital acted as exclusive financial advisor to the transaction and has reinforced its position as a leader in syndicating equity for mid-market companies in the healthcare space. With the completion of this transaction, Spark has advised on 18 transactions aggregating USD 386 Mn across various sub-segments of the healthcare space.
As exclusive financial advisor to the transaction, Spark Capital :
Engaged with Corona significantly ahead of the transaction timeline to ideate, structure and time the transaction to optimize outcomes for the promoters and the CompanyIdentified, marketed and engaged with the most suitable set of investorsDrove negotiations …

Cyril Amarchand Mangaldas tops League Table for Legal Advisors to M&A Transactions in H1 2016

AZB & Partners, Trilegal complete the top 3 slots; Khaitan & Co. tops by deal volume




Cyril Amarchand Mangaldas (CAM) topped the Venture Intelligence League Tables for Legal Advisors to M&A transactions for the first six months of calendar 2016 advising deals with a value tag of $7,580 million (across 17 qualifying transactions).  CAM was followed by AZB & Partners which advised deals worth $3,899 million (across 19 qualifying deals) and Trilegal ($2,579 million across 12 qualifying deals).

The Venture Intelligence League Tables, the first such initiative exclusively tracking transactions involving India-based companies, are based on value of PE and M&A transactions advised by Transaction and Legal Advisory firms.

CAM advised M&A deals during the period included the $2,380 million acquisition of Jaiprakash Associates’ cement plants by UltraTech Cement and the $978 million acquisition of Jindal Steel and Power’s thermal power plant by JSW Energy. Transactions advi…

StanChart tops Transaction Advisor League Tables for M&A deals in H1 2016

Standard Chartered Bank topped the Venture Intelligence League Tables for Transaction Advisor to M&A transactions for H1 2016 advising M&A deals worth $2,844 million (across 2 qualifying deals) followed by Barclays and JM Financial ($1,370 million across one deal each) and Axis Capital ($922 million across four deals).

Standard Chartered Bank advised M&A deals during the year were the $2,380 million acquisition of Jaiprakash Associates’ cement plants by UltraTech Cement and the $464 million acquisition of Tata Communication Data Centres by Singapore Technologies Telemedia. Barclays and JM Financial advised the $1,370 million acquisition of Welspun Renewable Energy by Tata Power. Axis Capital advised M&A deals in H1 2016 were the $706 million acquisition Reliance infra’s cement subsidiary by Birla Corporation and the $140 million buyout of NBFC firm AU Housing Finance by Kedaara Capital and Partners Group.

Inclusive of its roles in related advisory activities (Due Dili…

Goldman Sachs tops League Table for Financial Advisors to Private Equity Transactions in H1 2016

Morgan Stanley, Kotak claim the no.2 and no.3 slots; E&Y tops table inclusive of due diligence, other services



Goldman Sachs claimed the top position in the Venture Intelligence League Table for Transaction Advisor to Private Equity deals for first half of the calendar 2016 acting as financial advisor to two qualifying PE investments worth $365 million during the period. Goldman Sachs was followed by Morgan Stanley ($230 million across one deal) and Kotak ($227 million across three deals).
The Venture Intelligence League Tables, the first such initiative exclusively tracking transactions involving India-based companies, are based on value of PE and M&A transactions advised by Transaction and Legal Advisory firms.
The PE transactions advised by Goldman Sachs included the $321 million investments by Fairbridge Capital in Bangalore International Airport and the $44 million investment in Healthcare Global by anchor investors IFC, Sabre Capital and others. Morgan Stanley advised the…

AZB leads Legal Advisor League Table to Private Equity Transactions in H1 2016

Cyril Amarchand Mangaldas, Shardul Amarchand Mangaldas claim No.2 & No.3 slots

AZB & Partners has retained its status as the top Legal Advisor for Private Equity transactions during the first six months of calendar 2016. According to the Venture Intelligence League Tables, AZB advised PE deals worth $3,158 million (across 23 qualifying deals), followed by Cyril Amarchand Mangaldas ($2,393 million across 17 deals); Shardul Amarchand Mangaldas ($2,118 million across 19 deals)
The Venture Intelligence League Tables, the first such initiative exclusively tracking transactions involving India-based companies, are based on value of PE and M&A transactions advised by Transaction and Legal Advisory firms.
AZB & Partners advised deals during H1 2016 included the $200 million investment by Ontario Teachers Pension Plan and others in e-commerce firm Snapdeal.com and the $145 million investment by Warburg Pincus, Temasek and March Capital in automobile classified company CarTrade.co…

Challenges for VC Exits: Mint

A Mint article titled Yatra, CaratLane deals put spotlight back on VC exits quotes Venture Intelligence data to highlight trends in this segment:
There have been 19 exits till date this year, data from Venture Intelligence shows, and, expectedly, the conversation has shifted to whether venture capitalists (VCs) invested in India are seeing their first real exit season. Challenges to Exits for VC-backed companies (accordingly to the article): The proportion of M&A activity to VC investments in US/Israel is 4:1 or 5:1 compared to India's 1:1 leading to poor liquidity in the system - Nitin Bhatia, Signal Hill

Most Internet companies in India are yet to show profits (many don’t even have a path to profitability), which rules out a public markets listing as an exit route for investors - Satish Andra, Endiya Partners. In 2015 alone, the US saw 28 tech IPOs. (Recent Indian tech IPOs in 2015-16 are Quick Heal Technologies, Infibeam and Ortel Communications.)

India is still a very young m…

Buyouts are Back!

A Mint article titled Buyout activity set to cross 2015 highs; slow start to PE exits quotes Venture Intelligence data on high Buyout activity in 2016. Buyouts showed strong momentum in the first six months of 2016, with the total number of deals and deal value at 14 and $2.44 billion, respectively, data from private equity (PE) and venture capital database Venture Intelligence show. Buyout deal value more than doubled from $1.14 billion in the same period last year. The key sectors that contributed to the increase are information technology (IT) services, financial services and healthcare. The top buyout deals of the first half of 2016 included Blackstone Group LP’s $1.1 billion acquisition of a majority stake in listed IT firm Mphasis Ltd, Kedaara Capital and Swiss private equity (PE) firm Partners Group’s purchase of mortgage lender AU Financiers for around $140 million and Abraaj Group’s $221 million deal to buy Care HospitalsReasons for Increasing Buyout activity (according to…

Spark Capital advises Suryoday on INR 2,174 Mn Round of Primary Capital Raise and Secondary Stake Sale

Spark Capital is pleased to announce successful closure of INR 2,174 Mn round in Suryoday Micro Finance Ltd (“Suryoday” or the “Company”), through a combination of primary capital raise and secondary sale of shares by existing investors (“Selling Shareholders”). Spark Capital acted as exclusive financial advisor to the Company and the Selling Shareholders for the transaction. This deal reaffirms Spark’s leadership position in the BFSI space having consummated 26 transactions aggregating ~USD 1 Bn value across various sub-segments of the BFSI space. This transaction also marks Spark's 7th successful closure in microfinance and allied sectors, aggregating ~USD 200 Mn.

About the Transaction: Suryoday has obtained an in-principle approval from the Reserve Bank of India to convert itself into a Small Finance Bank (“SFB”). Taking into consideration the regulatory requirements pertaining to shareholding for conversion into an SFB, the Company has raised fresh equity capital from domestic i…

Trends to Watch out in Healthcare: Outlook Business

(Click to View)
Outlook Business quotes Venture Intelligence data in an article titled Change Of Heart covering the recent good exits by PE/VC funds in the Healthcare segment and trends going forward. "there have been 24 PE exits worth $720 million in 2015, the highest since 2011, according to Venture Intelligence. Many of the exits have been via IPOs." "PE exits through IPOs have yielded returns as high as 4.53x — when Ridgeback Capital sold its stake in Granules India in 2015. Thyrocare Technologies, whose IPO in May this year yielded a return of 3.5x for CX Partners, seems like it was a matter of good timing." The IPO of Narayana Hrudayalaya, a multi-specialty hospital chain, also generated significant interest and was eventually oversubscribed around 8x.  "The private sale of Intas Pharmaceuticals by ChrysCapital to Temasek Holdings got returns of 17.6x, much higher than the public exit of Baring India from Indoco Remedies at 5.2x, according to Venture In…

Nexus Ventures' Naren Gupta bemoans "short-termism" among current Indian startup founders

Naren Gupta, the highly respected Silicon Valley based founding partner of Indo-US cross-border VC firm Nexus Ventures, has published an article in Forbes India highlighting some areas in which the current crop of Indian startup founders could do better. Extract:
Over the last few years, I have failed to see this focus or commitment in many of the new-age company founders or management teams in India. They seem overly focussed on their image in the media, maximising valuations in the next funding rounds, and other short-term bragging rights. Where is the focus on exceptional products and customer satisfaction?   My belief is that today’s even moderately successful Indian entrepreneurs are so distracted that they cannot maniacally focus on building great companies. The baubles that distract them range from angel funding to building fancy bungalows. During my recent visit to Bengaluru, I cringed when I was told that many executives of rapidly growing companies were spending time with a…

PIPE deals fall sharply in first half of 2016: Mint

During May-June 2016, PE funds invested $154 million in public equities, the lowest amount since April-June 2014

The Mintquotes:  According to data available from Venture Intelligence, a research service focused on private company financials, during May-June 2016, PE funds invested $154 million in public equities, the lowest amount since April-June 2014 when PEs invested $205 million. Since January this year, PEs have invested $414 million through PIPE deals, as compared to $1.12 billion during the corresponding period last year, a significant drop of 63%. In fact, except for 2014, when investors were in wait-and-watch mode ahead of the elections, the numbers are lowest in the last five years. Reasons for the fall, according to the article include:  The run up in valuations in preferred sectors e.g. Healthcare The large base in the previous year of more than $1 Billion invested in Listed companies by PE firmsRelated: Private Equity Update for Q2 2016

Exits via Public Market sales have a…

VC Investments at all time high - minus 2015 that is - shows Venture Intelligence study

Venture Capital firms made 197 investments worth $623 million in Indian companies during the six months ending June 2016. The investment activity in H1’16, while 18% lower compared to the same period in 2015 (which witnessed 240 investments worth $958 million) is actually the highest ever (if we were to ignore the "dream year" of 2015), Venture Intelligence show. 

Arun Natarajan, Founder, Venture Intelligence and Ashish Fafadia, CFO, Blume Ventures discuss these numbers in the ET Now Startup Central show.

In the video, Ashish Fafadia of Blume points out how, with more seed and angel capital becoming available, Series A funding will continue to be a "choke point" for startups.
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.


PE-RE Investments in India down 24% in Q2 2016

PE-RE Investments in India during Apr-Jun 2016: 16 deals, $579 Million
Private Equity-Real Estate firms made 16 investments (amounting to $579 million) during the quarter ended June 2016, according to data from Venture Intelligence. The volume of investments was down about 23.8% from the 21 investments (worth $868 million) in the same period in the previous year. However compared to the immediate previous quarter which had witnessed 12 investments (amounting to $902 million), the volume of Investments was up 33%. For the six months ending June 2016, there were 196 deals worth $635 million compared to 239 deals worth $959 million in the same period in 2015. 
The predominant focus of investors continued to be on the residential segment in the main metros which accounted for 15 of the total 16 investments. Projects in South and West India accounted for six deals each, followed by North with four deals. East and Central region did not receive any investments.


The largest PE-RE investment …