India Value Fund raises $725m for Fund IV

The Mumbai-based buyout firm has almost doubled the size of its previous fund, bringing total assets under management to $1.4bn.

India Value Fund Advisors, one of the few Indian private equity firms that focuses on buyouts rather than growth capital, has raised $725 million for its fourth fund.

Vishal Nevatia, managing partner and chief executive officer at the firm, confirmed the fund’s final close in June but declined to comment further.

Though it is likely to make more investments than its predecessor, Fund IV will continue the firm's strategy of acquiring controlling stakes in companies in varied sectors including pharmaceuticals and healthcare, retailing and supply chain management, outsourced services and media and entertainment. India Value Fund Advisors invests between $25 million and $100 million per deal with an average bite size of about $60 million to $70 million.

The firm is currently investing out of a $400 million fund which closed in January 2007. Nevatia declined to comment on how much capital the fund has deployed. The firm’s first fund closed on $35 million in 2000 and its second was a $175 million vehicle which closed in January 2005.

India Value Fund is one of the few firms focused on buyouts in what is typically seen as a growth market. One fund of funds manager said that the firm makes investments in what he called “growth buyouts” – transactions in which the firm acquires controlling stakes in growing businesses with little or no use of leverage. The strategy is not so much to turnaround businesses as much as to grow an existing business further.

India Value Fund was established in 2000 as GW Capital, a joint venture between India’s Housing Development Finance Corporation, Ambit Corporate Finance and Gary Wendt, the former chairman and CEO of General Electric Capital.

It has offices in Mumbai, Bangalore and Connecticut.