Why Wilbur Ross Likes India

Two years ago, Wilbur Ross, an investor in distressed securities, set up a $300 million fund focused on India. He convinced India's Housing Development Finance Corp. (HDFC), a local giant, to partner with the fund, bringing its extensive network of local contacts and strong reputation to the venture. He staffed an office in Mumbai, run by managing director Ranjeet Nabha, a Dartmouth MBA who had been a vice-president at JPMorgan Chase (JPM) and later CEO of a software company. And then Ross proceeded to do very, very little.

Now, Ross is at last making a major move. On Aug. 11, the chairman of New York-based WL Ross & Co. announced his India fund would buy an $80 million chunk of convertible bonds issued by Indian discount airline SpiceJet (SPJT.BO). The once red-hot Indian stock market has cooled down enough to suit Ross, who made his name patching together the remnants of dying U.S. industries like textiles and steel. And several years of cutthroat competition—and more recently, record-high prices for jet fuel—have left India's nascent airline industry in particular need of help (BusinessWeek.com, 7/7/08).