Mid-market private equity firm Lighthouse Funds has hit the final close of its third fund at Rs 1,750 crore ($250 million), including a pool of capital for co-investment opportunities.
Lighthouse India Fund III, which was initially looking to raise $200 million, has closed at Rs 1,600 crore ($230 million), said co-founder Mukund Krishnaswami. The fund has drawn down $20 million more for co-investments from its limited partners, he said.
Lighthouse now manages cumulative assets under management of nearly $500 million. It had raised $100 million for its first fund in 2008 and about $135 million for its second fund in 2013.
The global LPs in the third fund include International Finance Corporation. The World Bank’s private-sector investment unit had said in late 2017 that the firm and its asset management arm planned to invest a total of $45 million in the third fund.
Britain’s CDC Group Plc and Germany’s DEG have committed $25 million and $11.5 million, respectively, to the fund.
Krishnaswamy said about 10% of the total capital was raised from Asian, including West Asian, investors while the remaining was from the US and Europe. A number of global endowments, pension funds and family offices participated in the fund, he added.
The new fund will invest Rs 50-300 crore in high-growth companies. It has already invested in orthotics brand Tynor, footwear company Aqualite, mattress brand Duroflex and online beauty retailer Nykaa.com.
“We are looking to make another six to seven investments from the current fund. We would be able to raise additional money from the sidecar fund based on the deal size,” he added.
The PE firm was founded in 2006 by Sachin Bhartiya, Sean Sovak and Mukund Krishnaswami. It has a team of 15 professionals including operating advisers. The firm has backed consumer-centric brands such as Bikaji Foods, WOW! Momo, Kama Ayurveda, Cera Sanitaryware, FabIndia and V2 Retail.
PE fundraising
Lighthouse joins a number of PE firms that have hit milestones for new India-dedicated funds.
Homegrown PE firm CX Partners marked the first close of its second sector-agnostic fund at $140 million in May last year.
Late last year, homegrown PE firm TVS Capital Funds Ltd overshot its target for the first close of its new rupee-capital fund to Rs 832 crore on the back of significant demand from both existing LPs as well as new investors.
Last year, Motilal Oswal Private Equity Investment Advisors finished raising capital for its third sector-agnostic fund at over Rs 2,300 crore ($320 million).