Baring PE to exit Fund-II soon

The company has completed investing its third fund, to the tune of $530 million, which is expected to be closed by 2018

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Baring Private Equity Partners expects to close its second fund in the country by 2017, almost 10 years after invested its entire $175 million in India.

The company had also completed investing its third fund, to the tune of $530 million, which it expected to be closed by 2018, said Sundaram Sivaramakrishnan, partner and chief financial officer of its India entity.
 

It invested in 12 companies from Fund-II and has made an exit from nine. "We are now looking for an exit in the rest. Typically, our fund duration is around 10 years and we expect the duration of this one to also be the same," he said.

The investments in its various funds has been into the information technology, pharmaceuticals and biotechnology, financial services, manufacturing, real estate and consumer goods sectors.

Fund-III’s investment of $530 million was done between 2008 and 2015. Typically, the company looks at the high teens or low 20s in dollar terms as (percentage) returns.

"Over the next five years, we will be more of harvesting in this fund. About 90 per cent of the capital in Fund-III is invested into around 11 companies," he said. Including Lupin, Zydus Cadila, Cipla, Indoco Remedies, Shilpa Medicare, Marico, Dabur, Manappuram Finance and Mphasis.

Typically the company looks at the high teens or low twenties, in dollar terms, as returns.

"Exits has never been a constraint for us. So far, we have made 53 investments. We have so far wholly or partially exited 27 of these and we have exit pathways for most of the remaining investments," added Sivaramakrishnan.

He added that the significant change that is happening in the Indian investment scenario is that the mindset of the industrialists is changing more towards diluting equity for better growth and increasing value. The companies also realise that they are also growing in terms of scale, and the percentage of growth a few years back is not equal to the growth in the same percentage this year. These are positive trends for the private equity investors, he said.

He further said that while there are predictions that investors would have a difficult time in the country now, it would take some more time to see the impact.