Carlyle reaps over 9x return on India exit

The firm has sold down its entire remaining stake in Chennai-based Repco Home Finance

Global private equity firm The Carlyle Group has sold its remaining stake in Indian housing finance company Repco Home Finance in a block trade worth about INR 4.6 billion ($77 million; €57 million), a source close to the deal confirmed to Private Equity International.  

The firm did not disclose the financial details of the transaction, but the source said the exit gained the fund a more than 9x return.

Carlyle invested in Repco Home in 2008 through a number of tranches, committing $27.7 million of capital through its Carlyle Asia Growth Partners III, a $680 million vehicle focused on high growth companies in India, China, Japan and Korea.

The firm then successfully listed the business in March 2013, and have made a series of partial exits through pre-IPO deals.

Repco Home, which provides home loans to people across South India, received backing from private equity firm Creador Capital and Wolfenson Capital Partners, a private investment fund of the former World Bank president James Wolfenson.

Creador bought a 9.9 percent stake in a deal worth $13.7 million in February last year – a month before its initial public offering, PEI reported earlier.

The deal is Carlyle’s third disclosed exit in India this year, having revealed the sale of its investment in India-based Cyberoam Technologies to UK security software firm Sophos in February.

Carlyle declined to provide financial details of the transaction, but said in the statement it had held a majority stake.

First Carlyle Ventures Mauritius, the growth vehicle Carlyle used for the investment, acquired a majority stake in parent company Elitecore Technologies in 2007, reportedly for $10.3 million, during the boom years of private equity investment in India. It later invested a further $3.1 million. Elitecore's network security business, Cyberoam, then spun off in 2012.

The firm also sold its investment in Tirumala Milk Products in January to global dairy company Groupe Lactalis. 

Carlyle has also been actively investing in India, acquiring hospital business Global Health Private Limited in December last year, PEI reported earlier. Investing from its Carlyle Asia Partners III, it took a minority stake in the business, as well as acquiring a significant equity stake held by Avenue Capital Group.

The financial details of the transaction were not disclosed and Carlyle declined to comment further.

Carlyle is also in the midst of raising its latest Asia-focused private equity vehicle, which is targeting $3.5 billion and expects to close by the end of this year, David Rubenstein, co-chief executive and co-founder of the firm, said on an earnings call earlier this year.