Private Equity's Men in Control ; Unlike Most Other Private Equity Investors, Actis, Baring and India Value Fund Like to Acquire Majority Stakes in the Companies They Invest In. Why, and Do They End Up Generating Better Returns?

Summary

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All of May this year, Baring Private Equity Partners India's (BPEPI) Partner, N. Subbu Subramaniam was on the road. Starting with the UAE, the Gurgaon-based investor then hit London, followed by New York, New Jersey, San Francisco and then Los Angeles. By the time Subbu returned to Delhi, he had logged over 30,000 air miles. Nothing unusual for deal makers like him, except that Subbu wasn't on a mission to raise money or find companies to invest in. Rather, he was making sales calls for the four companies in BPEPI's Fund II. I basically attempted to introduce portfolio company CEOs and regional heads to decision makers of potential customers, says Subbu. For instance, he introduced the management of Infrasoft Technologies to banks in the UAE.

Similarly, he introduced Integra Software to print and electronic media companies in the US. That apart, he reviewed M & A opportunities for portfolio companies and interviewed potential candidates to head sales/marketing functions.

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Private Equity's Men in Control ; Unlike Most Other Private Equity Investors, Actis, Baring and India Value Fund Like to Acquire Majority Stakes in the Companies They Invest In. Why, and Do They End Up Generating Better Returns?

That Subbu should spend over a month globetrotting for Baring's portfolio companies is a pointer to his firm's investment philosophy. In a country where there were around 400 PE and VC firms, investors come in all shapes and sizes.

There are those that are happy to take a minority stake in a private company, some even invest in publicly-listed companies, while some others buy out companies, never mind if they are listed or unli...

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