Franklin Templeton invests $13m in GKC Projects

The Indian infrastructure construction company will use the investment from Templeton's retail private equity fund for the acquisition of larger projects.

Franklin Templeton Asset Management (India) has invested up to INR600 million ($13 million; €9.2 million) in GKC Projects, an infrastructure construction company, for an undisclosed stake. Other details pertaining to the transaction were not revealed.

The investment was made from the Franklin Templeton Private Equity Strategy, an India-focused fund which closed on INR6.3 billion in October 2008. The fund is advised by Darby Asia Investors (India), the private equity affiliate of Franklin Templeton.

Hyderabad-based GKC provides construction services for roads, irrigation, power and pipelines across India. It now aims to execute projects of a larger size and enter new areas including mining and railways. The capital injection will be used for new pipeline projects as well as for the acquisition of larger projects in other areas, Franklin Templeton said in a statement.

Franklin Templeton Private Equity Strategy, capital for which was raised entirely from Indian high net worth individuals, invests in high-growth, mid-sized unlisted companies in the infrastructure, manufacturing, consumer goods and related sectors.

In July 2009, the fund invested INR500 million for an undisclosed stake in Career Point Infosystems, an examination preparation company that provides training and preparation for competitive examinations, and coaching for admission to the Indian Institutes of Technology and other colleges and universities.

Franklin Templeton also invests in India through Darby Asia Mezzanine Fund II, which earlier this week provided a $33.5 million senior secured convertible loan to PECH Holdings, the holding vehicle of Prestolite Electric Beijing (PEBL), which manufactures alternators and starter motors.

That fund’s investments in India include Amalgamated Bean Coffee Trading Company, a coffee conglomerate involved in coffee procurement, processing and retailing; Bhoruka Power, a company engaged in the construction of wind power and small hydroelectric projects; and Escorts Construction Equipment, a manufacturer of heavy construction and material handling equipment.