Reliance PE becomes Fairwinds, targets $300m fund

The fund - Fairwinds II - has a hard cap of $350 million, CEO Ramesh Venkat told AVCJ. It will invest about $20-40 million per deal and focus on companies in the consumer, services, manufacturing and infrastructure sectors.

Reliance ADAG holds a small minority stake in Fairwinds. The spun-out entity will continue to manage Reliance Alternative Investment Fund - Private Equity Scheme I, a $200 million vehicle raised in 2010 in which Reliance ADAG has a 20% LP interest. The former parent is yet to contribute in the new fund but is expected to make a contribution, albeit not as an anchor investor.

"There will be a large cross-section of new LPS, as our first fund was predominantly raised in India, whereas in this new fund we expect a larger proportion to come from overseas," said Venkat. 

Fairwinds will retain the same nine-member team that worked together at Reliance Equity Advisors, which includes three partners, five directors and a CFO. Similarly, the new fund's investment strategy is broadly the same as that of its predecessor.

"There will be no dramatic changes from the first fund as we are very happy with the companies we have been able the source, and the way those investments have scaled up over the last five years," says Venkat. "However, the situation in India has changed and there is far greater stability in terms of policy, so we may want to look closer at infrastructure - a sector we stayed away from in Fund I given the previous policy instability."

Fairwinds will also focus on exiting its investments from the first fund, with a view to returning capital to its LPs over the next two years - the firm is already said to be in the process of exiting chemical manufacturer VVF and education services provider Pathways.

Investments in Fund I include Shankara Infrastructure Materials, a multi-store chain that sells infrastructure materials; Max Flex and Imaging Systems, a manufacturer of digital printing related goods; and cookware maker Butterfly Gandhimathi Appliances.

A number Indian GPs have returned to the market in the market in past year, as investor sentiment towards the country improves. 

In May, Multiples Alternate Asset Management - the firm which previously spun out from ICICI Ventures - revealed it was was targeting around $500 million for its second fund. Everstone Capital is currently in the market with its third fund, which is targeting $650 million and recently won a commitment from the International Finance Corporation (IFC).

Meanwhile, Rajeev Gupta, formerly of The Carlyle Group, and Amol Jain, previously of TPG Capital, are launching a new $500 million PE fund focusing on mid-market buyout opportunities in India.

 

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• Topics
• South Asia
• Fundraising
• Expansion
• Reliance Capital
• India
• Growth capital
• Fundraising