Apax, Bain Capital join race for stake in Kalyan Jewellers

US-based private equity majors Apax Partners and Bain Capital are in talks with Kerala-based Kalyan Jewellers to acquire a minority stake. According to sources in the know, the company is valued at Rs 15,000 crore. Kalyan Jewellers has annual turnover of Rs 9,400 crore.

Earlier, there were reports that funds such as Blackstone, TPG Capital and Temasek Holdings had evinced interest in Kalyan.

"It is true that a few large private equity funds have approached us for investments and the discussions are on. But nothing has been finalised yet," said Ramesh Kalyanaraman, executive director at Kalyan Jewellers.

The retailer plans to float an initial public offer (IPO) when the company touches sales revenue of Rs 20,000 crore. "The PE investors will get a good exit after two or three years when the company launches the IPO. That is why PEs are pitching aggressively for the minority stake," said a source close to the development.

Notably, both Apax and Bain Capital were in discussions to acquire a stake in jewellery business of Gitanjali Group in 2010, which did not fructify.

When contacted, Shashank Singh, co-head and managing director of Apax Partners India, refused to comment while an email questionnaire sent to Bain Capital did not elicit any response.

India's organised jewellery market accounts for a mere eight per cent of the total market worth $45 billion. Leading organised gold retailers include Titan, Kalyan Jewellers, Tribhovandas Bhimji Zaveri, PC Jewellers and Gitanjali.

Kalyan Jewellers owns 52 retail stores across the country while six stores are operated in the United Arab Emirates. It plans to add 19 more stores in India and in West Asia by FY15.