Private equity major Temasek Holdings, which was the largest investor in the consortium of PE players which invested in Bharti Infratel, the hived-off telecom tower arm of Bharti Airtel, is keen to do more such ?club deals? in future.
Speaking to select journalists at a luncheon meeting Thursday, Manish Kejriwal, senior managing director, Temasek Holdings and country head, India, said such ?club deals?, where a few PE players together pick up stakes in companies, was a good way of collaborating between such players and often reducing needless competition. ?Rather than each going for the entire $500 million, it is sometimes better if there are a few players sharing the amount between them. From the company promoter?s perspective too, it is good since more shareholders come in with smaller stakes, rather than having a single shareholder with a large stake,? Kejriwal pointed out.
He said Temasek, having reached a stage where it is the largest PE player in India, was not ?insecure? and would not hesitate to tie up with other PE players and invest jointly in companies.
The first major club deal in India was the $1.25 billion Bharti Infratel one, where Temasek led the seven-member PE pack with a $500 million investment, followed by KKR with $250 million, with Goldman Sachs, Citigroup, India Equity Partners, Macquarie and Investment Corporation of Dubai (ICD) also joining in. ?It is, however, not with the purpose of spreading out the risk that we will go for club deals. We always welcome others with expertise in some areas, and they can join us in investing,? Kejriwal said.
The towers business was a preferred choice owing to its long-term and predictable cash flows. The deal was by way of a convertible issue, and the exact quantum of stake would depend on the company?s performance, after which the final valuation of the company would be known.
Blackstone invests in Allcargo
The Blackstone Group on Wednesday announced that it would invest $60 million in Allcargo Global Logistics Ltd subject to seeking necessary mandatory and regulatory clearances. Blackstone will have representation on the board of Allcargo and will purchase additional shares of the company from the open market from time to time. It intends to maintain its ownership below 15%. Allcargo will raise the $60 million through a fresh issue of equity shares, fully and compulsorily convertible debentures and optionally convertible warrants, the company said.