Candover, a leading European private equity house, is setting up an office in India, The Economic Times has reported. The firm, which has raised nine funds with total capital commitments of more than €8.7 billion ($13.48 billion) over last 28 years, has roped in Harsha Raghavan from Goldman Sachs to head its India unit.
Raghavan was co-head (India) for the principal investments in Goldman Sachs since 2004. Candover is in the process of raising a Euro5 billion fund. The European private equity biggie has chosen Mumbai to set base its operations with a core team of around five people.
Candover is going global with its plans to invest in China and Australia apart from other South east Asian economies. The report quotes Jamie Paton, the head of Candover’s office in Hong Kong, that India is a very important market for Candover, and that it would look for investing in segments like lifestyle, luxury goods, energy, industrial sector and media. Candover would also looks at sectors such as financial services, healthcare and technology.
They would also look at partnering with local companies to pursue buyouts of European firms. Most recently, Electra Partners, said that it was planning to forge relationships with general partners in India, not only to source investments, but also to provide advice and insight on the local market to its European portfolio companies. Candover would essentially look at leveraging its experience in the European markets, for which it would take minority stakes in Indian companies looking for expansion in the European markets. Its deal size typically varies between Euro150 million and Euro500 million, but it would not look at any particular transaction size for Indian companies, adds the report.
Candover, which has invested more than E46 billion in buyouts in Europe since 1980, primarily focuses on European market with offices in the UK, France, Spain and Italy.
European private equity firms in India
There is a surge of European private equity firms increasing their clout in India. CDC Group, the UK government-backed private equity fund of funds investor, recently announced investments of a total of $435 million in nine Indian private equity funds. Electra Partners, a UK based mid-market private equity firm renewed its interest in India after a decade by investing $15 million in Gaja Capital Partners. Lloyds TSB Development Capital (LDC), the private equity arm of the UK-based Lloyds TSB, is drawing up an Asia strategy in which India will also figure prominently. LDC, one of the UK’s biggest private equity investors in small- to mid-sized companies, is setting up an office in India. Rabobank, the Dutch bank with special focus on food and agriculture worldwide, recently announced the first close of India’s first private equity fund focused on food and agribusiness.
European private equity firms are increasingly committing fresh allocations to India or are looking at India as an important investment destination. The amount of funds raised by European private equity firms saw a 16 per cent jump to $61.1 billion invested in 80 funds, as compared to the $52.5 billion invested in 81 funds during the same period last year, according to Dow Jones Private Equity Analyst (see our. Buyout funds accounted for nearly 90 per cent of Europe’s fund-raising total.
The differing fortunes of European private equity funds are an indication that limited partners are shifting some attention away from the U.S., where the economy is seen as particularly weak and where many of LPs are over-concentrated.