Everstone forays into stressed assets

The Singapore-based firm will start investing in stressed companies in India and has hired a former director at Advent International to head the new business unit.

India-focused private equity firm Everstone Capital Partners has hired a former director of buyout fund Advent International, Avnish Mehra, as its new managing director, the firm said.

Mehra will head Everstone’s new stressed assets business and manage the firm’s investments in healthcare and technology, media and telecoms (TMT), where he has significant experience.

According to an India Ratings report, as much as one-third of Indian companies have stressed loans accounting for 21 percent of total bank stressed credit, with the bulk of bad loans coming from state-owned banks. As a whole, India’s stressed loan pile is estimated to have hit more than $110 billion.

Earlier this month, the Reserve Bank of India (RBI) had required commercial banks to increase provisions to cover visibly stressed assets from 1 April 2016, fearing that its banking system would be weighed down by bad loans. RBI expects bad loans to rise to 12.5 percent by March 2017, compared to 10.8 percent in 2015.

Everstone joins private equity firms KKR and TPG Capital which already invest in turnaround and restructuring stressed assets in India.

Mehra worked in Advent’s TMT business in London before he founded its Mumbai office, leading investments in healthcare provider Care Hospitals, electrical energy company Crompton Greaves and credit information company Cibil and Cams. He had also worked in various executive positions at Dutch state-owned bank ABN AMRO and HSBC Asset Management.

“Mehra's strong background in both private debt and private equity will enhance our ability to do complex transactions,” said Sameer Sain, co-founder and managing partner of the Everstone Group.

The firm has been boosting its investment team in the past months. It hired Walt Disney executive Roshini Bakshi and Unilever’s Rajev Shukla as managing directors, and Citibank executive Bhavna Thakur as head of capital markets and exits.

In September last year, Everstone held a final close on its Fund III at its hard cap of $730 million, as reported by Private Equity International.

Investors in Everstone’s funds include the International Finance Corporation (IFC), University of Texas Investment Management Co. (UTIMCO), Maryland State Retirement and Pension System and Denmark’s Industriens Pension, according to PEI Research & Analytics.

In April, Everstone acquired AON Hewitt’s payroll business and Hindustan Unilever’s bakery business Modern Bakery. It had also exited its eight-year investment in Global Hospitals, generating a 3x return on investment in August.

Everstone manages more than $3 billion in assets across three funds.