Mumbai, Jul 2: The TVS and Shriram groups from the South have forged a growth equity fund to nurture mid cap business, especially those in emerging cities and turn around them into worldclass companies registered with the Securities and Exchanges Board of India (SEBI) under the Venture Capital Funds Regulation, the TVS Shriram Growth Fund would be managed by managed by TVS Capital Funds Limited, an asset management company founded by Gopal Srinivasan of TVS Group, the company said in a release here.
TVS Capital Funds Chairman and Managing Director Mr Srivasan said in the release that the fund was nearing completion of its target mobilisation of Rs 500 crore from institutional investors, High Net worth individuals, sponsors, the Board of Directors and the team associated with the fund.
He said TVS Capital Funds intends to raise an additional corpus of USD 125 million (Rs 500 crore), over the next twelve months, from offshore investors to attain a total fund size of Rs 1000 crore.
''The team composition and success in raising capital in a short duration, gives all of us great momentum to carry forward and achieve our goals. In the future, we intend to mobilize sector specific funds,'' he said.
''We are really excited as we have been able to raise this capital during difficult capital markets environment, which reinforces the investor's trust in the TVS Group and Shriram Group,'' he said, adding that despite the recent stock market volatility, the private equity segment had seen 151 deals, aggregating to Rs 23,100 crores in the first five months of 2008, compared to 140 deals totalling to Rs 16,400 crores during the same period of 2007. Historically, private equity funds that have started during market downturns have outperformed funds that have been invested in bull market years, he added.
The fund would be a strategic growth partner that understands the nuances of building businesses and offers a range of management expertise and professional services along the expansion path. Mr Gopal Srinivasan said, ''TVS and Shriram Groups will bring a proven business culture, infrastructure, and a wide network of relationships across several sectors and geographical regions to the nextgen entrepreneurs of India.'' The target companies for the fund would include Mid-cap companies, with revenues of Rs 30 to Rs 250 crore, proven business models that require growth equity capital, investments in sectors with consumer consumption theme and focus on emerging Tier II, III cities and metros. It would hold significant minority stake with active participation on the Board and have investment sizes of Rs 10 to Rs 50 crore, the release said Broad, diversified Board of Directors bring global experience and deep operational expertise to guide the team in scaling businesses. The Board of Directors included Prof C K Prahalad, University of Michigan, Mr R Thyagarajan, Founder, Shriram Group Mr Lakshmi Narayanan, Vice Chairman, Cognizant, Kenneth Tai, the Chairman and Co-Founder of Investar Capital, Co-Founder of Acer Computer, Dr Sridhar Mitta, MD and CTO, e4e India and Mr H Lakshmanan, ED, Sundaram-Clayton .