Photo: Bloomberg
Photo: Bloomberg

Vishal Bakshi quits Goldman Sachs to set up private equity business

Vishal Bakshi's new private equity venture, called Avatar Growth Capital, will focus on investing in high-growth companies

Mumbai: Vishal Kamalnain Bakshi has quit Goldman Sachs Group Inc. to set up his own private equity business called Avatar Growth Capital Partners, two people aware of the development said.

Avatar Growth Capital is a mid-market private equity firm that will look at investing in high-growth companies, one of them said. The size of the fund could not be immediately ascertained.

Bakshi, who was a managing director at Goldman Sachs, declined to comment.

Bakshi is on the boards of various Goldman Sachs portfolio companies such as Max India Ltd, Antuit Holdings Pte. Ltd, a Singapore-based big data solutions company, and DEN Networks Ltd. Prior to joining Goldman Sachs 2000, he served as a managing director at Credit Suisse Group AG.

Goldman Sachs has been active in India through its private equity as well as real estate investments including a $350 million investment in ReNew Power Ventures Pvt. Ltd, a wind power producer. It has also invested 900 crore in Piramal Realty, the realty arm of the Piramal Group, $250 million in real estate jointly with Nitesh Estates Ltd, $66 million in hospitality firm SAMHI Hotels Pvt. Ltd and $10 million in Azure Hospitality Pvt. Ltd, a pan-Asian casual-dining chain.

Bakshi is the latest to join the growing club of independent or entrepreneurial fund managers--those who broke away from their institutions to set up their own businesses.

Heramb R. Hajarnavis, who leads the private equity practice at KKR & Co. LP in India, has quit to set up his own private equity firm. Sunil Theckath Vasudevan, partner at home-grown private equity firm India Value Fund Advisors Pvt. Ltd, has quit to launch his own fund, targeting a corpus of $150-200 million.

Carpediem Capital Partners, a fund set up by former executives associated with India Equity Partners, is looking to raise 550 crore ($91 million).

Siddharth Parekh, the younger son of Deepak Parekh, chairman of mortgage lender Housing Development Finance Corp. Ltd (HDFC), has launched Paragon Partners, a $200 million fund.

The top management at Reliance Equity Advisors, the private equity arm of Anil Ambani-led Reliance Group, also moved away to start an independent PE fund. Private equity investments in India last year rose to a record $22.4 billion, 31% higher than the erstwhile peak of $17 billion in 2007, according to a report by consultant Bain & Co. India Pvt. Ltd. The deal value was 48% higher than in 2014 ($15.2 billion), the report said.

Fund-raising in the Asia-Pacific declined by 14% to $50 billion in 2015.

In recent months, the pace of deal-making in India has slowed as investors turn more cautious.

Yet, India-focused PE firms are carrying approximately $11 billion in dry powder, up from last year’s $8 billion, further reaffirming the potential for increased investments in the Indian market, the Bain report said. General partners, or investment managers, raised $4.3 billion in 2015 from domestic and offshore investors, or limited partners (LPs), which is higher than the $3.6 billion raised in 2012, $3.4 billion in 2013 and $3.8 billion in 2014, shows data from VCCEdge, which tracks investment activity. Since 2010, 115 India-dedicated funds have together raised $11.5 billion, shows the data.

“From a fund raising perspective, while the franchise is important, the individuals matter more and those who have a good track record stand a better chance of raising money than others," said Sanjeev Krishan, a partner and leader of the private equity and transaction services practice at PwC.

“As the market is maturing, most of the existing LPs have a reasonably firm view on the existing funds and managers; on their part, the fund seekers are trying to broaden their LP connect and reach new geographies and pools of capital. There are yet many untapped/under-tapped pools of capital and some of these require greater conviction to invest in emerging markets and this is a challenge that the Indian GP’s need to take up," Krishan added.

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