Kedaara to pursue carve-outs from Indian conglomerates

The firm's strategy has much in common with that of Clayton, Dubilier & Rice (CD&R), its partner for a $500 million India-focused fund, VCCircle reported. While CD&R provides the brand name and access to foreign LPs, Kedaara will contribute on-the-ground deal-sourcing and portfolio management skills.

The plan is to deploy $75-100 million per investment, take a controlling position and then work with management teams to develop companies. Emphasis will be placed on bringing operational value-add.

Kejriwal and Sharma left their previous positions in October and were then joined by Nishant Sharma, a former principal in General Atlantic's Mumbai office. Sources told VCCircle that Kedaara should achieve its fundraising target despite a difficult environment and has already received verbal commitments from several global institutions.

Indian spinout funds have seen mixed results in the last couple of years. While Renuka Ramnath, former CEO of ICICI Venture, closed her debut fund at $450 million late last year, Rajesh Khanna, former managing director at Warburg Pincus, has decided to cease fundraising.

Aside from Kedaara, spinouts currently in the market include Subbu Subramaniam, who left Baring Private Equity Partners India to set up MCap Fund Managers; P.R. Srinivasan, formerly of Citi Venture Capital International and now at Exponentia Capital; and Violet Arch Capital Advisors, which is run by Varun Bajpai, former head of SBI Macquarie Infrastructure Fund.

Industry participants expect conditions to deteriorate in 2012, with first-time fund managers who can't boast strong track records struggling to attract commitments. In 2009 and 2010, LPs invested $4 billion and $2.5 billion, respectively, in Indian funds. A total of 29 vehicles held final closings in each year. Nearly double are expected to seek capital in 2012.

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• Topics
• South Asia
• Fundraising
• India
• Fundraising
• Spin outs
• General Atlantic
• Temasek Holdings
• Multiples Alternative Asset Management
• Warburg Pincus Asia
• ICICI Venture Funds Management Company