Tata Capital to set up $1b fund with Power Finance
Tata Capital has teamed up with Power Finance Corp (PFC), an Indian power sector financing specialist, to set up a $1 billion private equity fund to invest in domestic power projects.
The private equity player would have 51% in the joint venture and the remaining shareholding would be owned by PFC. The fund is expected to be finalized within half a year.
"Initially, we shall start with $300 million," PFC chairman Satnam Singh told local reporters. "We specialize in lending to power projects but we do not have expertise in fund management. Therefore, we thought through synergy with partner's core competence in fund management, we can launch the fund jointly."
According to AVCJ Research, private equity and venture capital players spent a total of $493 million on India's power supply industry last year across seven deals.
In August, KKR strengthened its ties to India's Avantha Power & Infrastructure (APIL) by co-investing $120 million into the company less than a year after committing $50 million. The news came after Blackstone also put $112.7 million in Visa Power, an India-based company engaged in thermal power projects, for a 25.2% stake in July.
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