Piramal to exit 3i-backed Indiareit Fund; Jogani to remain CEO

Billionaire Ajay Piramal, founder of Piramal Enterprises Ltd, plans to sell his stake in 3i Group Plc-backed Indiareit Fund Advisors Pvt, a real estate venture capital fund, according to a letter sent to investors.

Piramal will sell the stake to avoid a conflict of interest with his own real estate development plans, according to the letter, which was obtained by Bloomberg News. The buyer’s identity wasn’t disclosed. Ramesh Jogani, chief executive officer at Indiareit and his team will continue to manage the funds, the letter said. Jogani said he couldn’t give a timeline for the sale when reached for comment.

Private-equity firms invested about $1.24 billion in 34 deals in India this year, according to a study by Venture Intelligence, a researcher based in Chennai. That’s a 69 per cent increase on the same period a year ago that had 22 investments valued at $735 million, it showed.

Indiareit, started in 2006, advises on funds worth about $850 million that invest in real estate in Mumbai, Chennai, Bangalore, Hyderabad and Pune. 3i, Europe’s largest publicly traded private-equity firm, is a cornerstone investor in Indiareit’s $200-million offshore fund, according to the fund’s website.

It made exits worth Rs 6.63 billion ($147 million) since its inception, according to the letter. The investment committee has approved four deals worth Rs 2.8 billion from the Indiareit Domestic Fund Scheme IV, which accounts for about 30 per cent of the Rs 9.25-billion fund.

Piramal, who sold his generic-medicine unit to Abbott Laboratories for $3.72 billion this year, set up a joint venture with Sunteck Realty in 2007 to develop real estate in the country. Piramal Sunteck Realty Pvt has about 20 million square feet under development with premium residential and commercial assets across Mumbai, Nagpur and Jaipur, according to Sunteck’s website.

Mumbai-based Piramal also has interests in health care, diagnostics, drug discovery and glassmaking.