True North sets $1.1b hard cap for sixth India fund
Indian private equity firm True North – formerly known as India Value Fund Advisors (IVFA) – has set a hard cap of $1.1 billion for its sixth fund, according to sources familiar with the situation.
This is True North’s first fund since its rebranding earlier this year. If fully subscribed it will be the firm’s largest vehicle to date, in addition to the biggest pool of capital raised by an Indian GP since ChrysCapital’s fifth fund closed at $1.25 billion in 2007. ChrysCapital subsequently returned $300 million from that vehicle, citing a poor market climate and limited investment opportunities.
The new fund will invest in True North’s core sectors of healthcare, financial services, consumer, and IT products and services. The firm, previously officially sector-agnostic, restructured its investment team into a silo for each sector at the time of its rebranding. It said the change was needed because India’s economy had developed enough depth to provide sufficient investment opportunities in specific sectors.
The GP will also reserve capital for investments in other promising sectors in hopes of building experience there.
True North seeks either controlling stakes or significant minority stakes in Indian mid-market companies in order to help build them into market leaders. Recent deals include a $200 million commitment to domestic hospital chain Kerala Institute of Medical Sciences and a $77 million investment, as part of a consortium including IDG Venture Partners and Wellington Management, in online financial services portal Policybazaar.
AVCJ Research shows nearly $4.4 billion raised for India-focused private equity funds so far this year, with 32 vehicles achieving partial or final closes. This compares to $6.5 billion across more than 40 funds in 2016, the most raised in eight years.
Significant closes this year include Kedaara Capital, which closed its second fund at the hard cap of $750 million in September after cutting back some investor commitments due to strong interest from LPs. ChrysCapital closed its seventh fund in February at $600 million, also beating its target.
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