August 2011 was a surprisingly robust month for US-India transactions with over 10 India-bond investments by US companies and three US-bound investments by Indian companies. The majority of India-bound investments comprised private equity transactions by funds such as Carlyle, KKR, and Matrix investing in the high growth markets of low-cost housing, specialized healthcare and power market. The key US-bound transactions from India consisted of mid-to-large size IT companies acquiring niche-focused IT companies.
Key India-bound transactions:
- Carlyle Group investment of $26 million in Value and Budget Housing Corp. Pvt. Ltd: In an attempt to increase its participation in India's emerging low-cost housing space, global asset manager Carlyle Group is expected to invest $26 million in Value and Budget Housing Corp. Pvt. Ltd (VBHC). VBHC aims to build a million entry-level homes across cities in 10 years. VBHC's initiative is a part of the affordable housing trend triggered by companies such as Tata Housing Development
- KKR purchase of 9% In Avantha Power - Private equity major Kohlberg Kravis & Roberts (KKR) has picked up a 9% stake in Avantha Power & Infrastructure Ltd (APIL), for $46 million. APIL is in the midst of entering the capital market to mop up Rs 1,250 crore through an initial public offer (IPO)
- Matrix Partners investment in Kids Clinic India Pvt Ltd: Matrix Partners India has invested Rs 45 crore in the first round of institutional funding for Kids Clinic India Pvt Ltd, which provides maternity and infant care under the brand Cloud Nine. This is the second healthcare investment by Matrix, which invests in venture and growth-stage transactions. Last year, it had invested Rs 50 crore in Centre for Sight (CFS), a chain of specialty eye hospitals.
- Verismo Networks acquisition of Digital Entertainment Corporation of India: Verismo Networks Inc., a US-based provider of Internet TV platform, has acquired Digital Entertainment Corporation of India, a provider of entertainment services.
Other India-bound investments included Sionix Corp joint venture with Indian water and wastewater treatment company Superklean Environmental Engineers Pvt Ltd and Three Pillar Global's merger with India-based BrickRed.
Key US-bound transactions:
- MphasiS' acquisition of US-based insurance solution provider Wyde Corp: IT services provider MphasiS has acquired US-based insurance solution provider Wyde Corp. With the buyout of the $30-million company, MphasiS is expected to expand its insurance business with an opportunity to marry its applications and BPO business with Wyde's software platform Wynsure.
- Datamatics acquisition of Cignex: India-based information technology (IT) firm Datamatics has announced on Tuesday that it has acquired approximately 72 per cent stake in Cignex, a California-based leading vendor of open source Enterprise Content Management solutions for businesses as well as government agencies, in a cash deal worth $17.39 million.
Welcome to the September 2011 edition of our US-India newsletter, which focuses on key developments and issues affecting foreign direct investments (FDI) and foreign institutional investments (FII) between the US and India. For more information, please visit www.ivgpartners.com |
