General Atlantic LLC, the U.S. private equity firm that manages $17 billion, is studying four acquisitions in India of as much as $200 million each, according to Ranjit Pandit, its head of investments in the country.
The planned deals are in the Internet, logistics, financial and infrastructure industries and will be “in the $100 million to $200 million range,” Pandit said in an interview in Mumbai yesterday.
General Atlantic, based in Greenwich, Connecticut, plans to step up investment in India after a stock market rout reduced valuations. The firm, which has typically spent about $50 million to $75 million per deal, will also look at acquisitions of privately held companies, said Pandit.
“We are looking at actively pushing a lot of money into India,” said Pandit. “We are looking to do fewer transactions but bigger transactions.” He called deal sizes of $100 million to $200 million the “sweet spot” for General Atlantic.
India’s private-equity market heated up this year as the stocks slump shuttered the market for public equity and loans got pricier, prompting companies to look for other sources of capital. Private-equity firms have announced $5.52 billion of deals in the country so far this year, up from $3.79 billion for all of 2010, data compiled by Bloomberg show.
General Atlantic has invested about $900 million in India since 2002. It owns stakes worth a combined $1.7 billion in eight Indian companies, according to Pandit.
Pandit said he expects two of the four deals the firm is working on in the country will close this year, while the other two will likely be completed in early 2012. The executive said he may also consider deals of as much as $400 million in the South Asian nation.
General Atlantic paid about $90 million for about 3.7 percent stake in IndusInd Bank Ltd. (IIB), a privately owned lender based in Mumbai. The stock is down 4.1 percent so far in 2011, the third-best performance among 14 companies on the BSE Bankex Index, data compiled by Bloomberg show.
The private-equity firm’s total investment in IndusInd Bank may reach $100 million to $200 million, according to Pandit.
Pandit said General Atlantic may sell stakes in information technology companies, without naming any of them. The firm owns shares in companies including Genpact Ltd. (G), Hexaware Technologies Ltd. (HEXW) and Infotech Enterprises Ltd. (INFTC) General Atlantic hasn’t decided whether to sell the holdings in public markets or to other companies, said Pandit.
“If we look at our information technology portfolio in India, without commenting on any specific company, it’s a group of companies which we held for some time,” Pandit said. “We may be reaching a point of diminishing return from them.”
He said Hexaware “has a lot of options and General Atlantic will look at all those options,” without elaborating.
General Atlantic, founded in 1980, is setting up a Singapore office, and is considering investing in Vietnam, Malaysia, Indonesia and Taiwan, Pandit said. Abhay Havaldar, who has been with the firm since 2002, will lead the Singapore office, he said.
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