Lazard, the New York-based investment banking and asset management firm is planning to form Rs 500-crore ($100 million) India-focused fund to buy significant minority stakes in mid-sized Indian firms.
This is the first major expansion move by a US investment bank in India after the economic failure of Lehman Brothers last September, which indicated the collapse of independent investment banking business.
Lazard is already operating its merchant banking business in India through Lazard India, in which it holds 74.64% stake. Lazard India managing director K Balakrishnan holds 25.07% and the remaining equity is with some other minority investors.
Now, the company is setting up Lazard India Growth Fund Trust, which will be registered with securities market regulator SEBI as a venture capital fund.
This financial services firm will invest in the units of this trust through a Mauritius based division to avail tax benefits. Lazard will also form Lazard India Advisors which will be the investment manager of the fund.
The onshore fund has targeted corpus of Rs 500 crore, which is to be sourced from both overseas and domestic institutional investors, including Indian public sector banks. Lazard is bringing in Rs 125 crore as sponsors contribution to the fund and will appoint IL&FS as the trustee to the fund.
The fund will seek investment targets in various sectors such as consumer services & organised retail, hospitality & travel, education, food processing, engineering & capital goods, power, logistics, telecom, IT-BPO, healthcare, life sciences & pharma, besides other manufacturing firms. It would not get into the real estate sector.
|
