PE investments soar to $5.44 b in Q1 17

Private equity investments increased 36 per cent to $5.44 billion across 117 deals in the March 2017 quarter, compared with $4 billion across 198 deals in the March 2016 quarter, according to data released by Chennai-based Venture Intelligence, which tracks PE and venture capital investments.

PE investment in the March quarter was 23 per cent higher than in the previous quarter ($4.4 billion across 179 transactions). The data includes VC investments but excludes PE investments in real estate, a press release from Venture Intelligence said.

IT & ITES companies accounted for 53 per cent of the PE investment value in the March quarter attracting $2.9 billion across 64 transactions, compared with $1.4 billion across 115 deals in the same period of 2016.

BFSI companies attracted $498 million across 17 investments followed by healthcare and life sciences companies attracting $496 million across eight transactions.

Almost $3.6 billion or two-thirds of the total value of PE investments were announced/reported in March, said Arun Natarajan, CEO, Venture Intelligence. The firm expects a few more large-ticket deals that were closed at the fag end of March, to be announced this week, he said in the release.

Many of the larger deals during the March 2017 quarter involved secondary sales by either the promoters or existing PE investors, the release said.

Telecom tower firm Bharti Infratel saw its parent company Bharti Airtel selling a 10.3-per cent stake to KKR and Canadian pension fund CPPIB for almost $952 million. CPPIB also invested $720 million in IT services firm GlobalLogic providing an exit route for existing PE investor Apax Partners.

True North (formerly India Value Fund) exited Manipal Health via a $215-million sale to Temasek and entered a new one — KIMS Group via a $200-million investment that gave an exit to Ascent Capital and OrbiMed, the release said.

In the Internet and mobile sectors, unicorns Flipkart and Ola are back in fund-raising mode in 2017, however, at significantly lower valuations than those they had attracted in 2015.

While Flipkart is reported to have attracted $1 billion in commitment as part of an ongoing $1.5-billion round from China’s Tencent and others, Ola is reported to have received commitments for $330 million led by SoftBank and other existing investors, the release said.

At 68 investments worth $314 million, VC investment activity in the March quarter fell to a three-year low. The previous low in terms of the number of VC investments was 63 in the second quarter of 2014.