Five years into business, Axis Private Equity is set to exit from its past investments, and pay back its investors with an eye to keep the relationships intact. According to officials, the venture capital arm of banking major Axis, is already engaged in talks with potential buyers eyeing exit from three of its investments this year.
Axis PE is in talks to sell its stake in Vishwa Infrastructure and Corrtech International, and plans to dilute its stake in Neesa Leisure through a proposed IPO. Axis Bank had sought to sell off the PE arm, but investors’ opposition forced the management scrap the plan early this year.
The 2006-founded Axis PE has invested about Rs 400 crore so far from its Rs 600-crore Axis Infrastructure Fund. Axis Bank, as an anchor investor, invested about Rs 225 crore in the fund which was closed in April 2008. Public sector banks such as Canara Bank, Bank of Baroda, Union Bank of India, United Bank, Corporation Bank, Syndicate Bank and Punjab National Bank invested together about Rs 200 crore.
Axis PE’s investments include Rs 126 crore in Harish Chandra India Ltd, Rs 75 crore in Neesa Leisure, Rs 67 crore in Corrtech International Pvt Ltd, Rs 60 crore in Vishwa Infrastructures and Services and the latest investment of Rs 54 crore in Shalivahana Green Energy in June 2009.
In March this year, as part of its revamp, Arun Korati, former executive director at Axis PE, was appointed CEO, replacing Alok Gupta. The new CEO, in his first media interaction after taking over the charge, said the PE arm’s focus was to retain investors’ faith by giving back their money with higher returns. “Our current focus is on keeping the relationships with our investors intact. Giving back their investments with high return is our first priority,” Korati said.
According to him, the company recently made a partial exit from investment in Vishwa Infrastructure by paying 25 per cent of investments to a few investors.
He refused to disclose details. Currently, Axis PE is reportedly in talks with Morgan Stanley PE and Olympus Capital to offload 35 per cent in Vishwa for Rs 350 crore.
“This year, we are looking to exit three of our past investments and already engaged in talks with buyers. It could be either strategic or secondary sale,” he said, but, again, won’t reveal anything more. Recently, Neesa had filed DRHP with SEBI to float an IPO to raise Rs 200 crore. The issue comprises an offer for sale of up to Rs 50 crore worth of shares by Axis PE. According to Korati, the remaining Rs 200 crore will be invested this year in three PIPE (private investment in public equity) deals. “We eye investments in listed space, especially in mid-cap infrastructure companies,” he said.
According to him, there is no immediate plan to raise a second fund. “Technically, we can do it as we have invested about 70 per cent of our first fund. For now, exits and further investments are our priorities,” he said.