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| GVFL picks up 40% stake in Bangalore-based FairTech |
| Kalpesh Damor / Mumbai/ Ahmedabad Nov 12, 2009, 00:05 IST |
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Continuing its efforts to fuel growth of early stage companies by investing in them, GVFL Ltd, an Ahmedabad-based Venture Capital regarded as a pioneer in the country, has picked up 40 per cent stake in FairTech Engineering Services Limited for an undisclosed amount. FairTech is a new generation aerospace consulting and services company formed by a group of aerospace domain experts.
FairTech based in Bangalore is the fifth investment by GVFL, from its SME Technology Venture Fund, which was launched in 2008 with a target corpus of Rs.450 crore. The main objective FairTech is to fulfill the needs and expectations of the global aircraft industry in the field of structural design, analysis, mid-life upgrades, modification and life extensions.
GVFL's decision to invest in the aerospace consulting and services company stems from the fact that India is becoming an attractive destination for aerospace industry. "With domestic demand in air travel projected to be the highest for India as well as defense and commercial offset policy being implemented, FairTech is fully geared to address the market," said Mihir Joshi, managing director, GVFL.
Aerospace industry in the country is poised to gain from Indian offset policy, which warrants foreign defence vendors to source 30 per cent of contract value within India.
“Our association with FairTech exemplifies our commitment to invest in scalable and niche businesses. We are optimistic about the aerospace market that India can address with the right domain skills and experience,” added GVFL MD.
"The last two years were extremely good for us and we have witnessed rapid growth in revenues in spite of the general economic slowdown. With excellent prospects for off-shoring engineering services in aerospace, we expect to sustain our growth both in revenues and profitability over the next three to five years. With equity funding from GVFL into FairTech, we look forward to benefit from the relationship,” said Subramani Srinivasan, CEO, Fairtech.
It may be mentioned here that over the span of 19 years GVFL has made 72 investments and 58 successful divestments through six venture capital funds.
Many of the investments made by the company were in technologies, which were adapted first time not only in India but also in the world. As far as SME Technology Fund is concerned, GVFL has made five investments, including that of FairTech. The sixth company is in process of being funded soon.
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