'India Is the Flavour of the Month, but It has a Long Way to Go'

Summary

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In 1983, when David Bonderman joined Texas billionaire Robert M. Bass as his investment advisor, he was a partner in the Washington D.C.-based law firm Arnold & Porter and the only investing experience he had was in real estate. But evidently Bass, founding member of the Oak Hill family of investment funds and who now manages another investment firm called Keystone Inc., had an eye for talent. After 10 successful years at Bass group, Bonderman teamed up with James Coulter and William Price to set up his own private equity firm, Texas Pacific Group. Today, TPG and its affiliates- including its Asian arm, Newbridge Capital-manage more than $20 billion (Rs 90,000 crore) in funds. Their portfolio of about 60 companies includes firms like J. Crew, Burger King, Ryanair, and Seagate Technologies, with combined revenues of $65 billion (Rs 2,92,500 crore) and headcount of 550,000 people in more than 120 countries. In India, TPG invests through Newbridge, which recently invested $100 million (Rs 450 crore) in the Chennai-based Shriram Holdings. Earlier, Newbridge along with Temasek, had invested more than Rs 600 crore in the Hyderabad-based Matrix Laboratories. In India recently and accompanied by Richard Blum of Blum Capital Partners, the low-profile Bonderman, 63, spoke with BT's R. Sridharan about his business and himself. Excerpts:

According to some estimates, a staggering $47 billion (Rs 2,11,500 crore) was raised last year in private equity funds for Asia, and half of that is expected to go to China and India. Isn't that too much money?

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'India Is the Flavour of the Month, but It has a Long Way to Go'

I've heard that number too, but I don't think it is accurate. There's no denying that there is a lot of interest in the region, but the number seems vastly inflated.

What in your estimate is a more accurate number?

I am not sure I know the answer to that question. If you include strategic investments in Asia-which I don't, because it tends to include companies investing in plants and materials-I have a high number. But my sense is only $80 billion (Rs 3,60,000 crore) was raised worldwide last year in private equity, and clearly not more than half of it could be for Asia-it's not possible. If you look at the deals that were done, 50 per cent of the deals were in the ...

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