Switzerland-headquartered investment firm Partners Group has opened an office in Mumbai, India to focus on opportunities in private equity, according to a statement.
The office, which opened on Monday, will be led by managing director Cyrus Driver, who will continue to build out the firm’s investment activities on the ground. Driver has previously been covering India from Singapore during his two years at the firm.
Two mid-level investment professionals will also transfer from the firm’s Singapore office to Mumbai over the coming weeks, with the firm intending to hire a senior executive in Mumbai before the end of the year.
The team of four, which is expected to grow over time, will focus purely on direct private equity investments, while Partners Group’s real estate, infrastructure and debt activities in India will continue to be run from the Singapore location. However over the mid- to long-term, the firm intends to build out its entire private markets capabilities in Mumbai, which will include all alternative asset classes.
After years of holding back from investing heavily in India, Partners Group now sees good investment opportunities in the country, Driver told Private Equity International.
In 2013, the firm made two India-related investments, including in technology support services firm, CSS Corp, and an additional investment in an Indian education business.
“Over the past two years we have become increasingly bullish even though the macroeconomic news has been disappointing,” Driver explained.
“It is only in the last couple of months that public markets seem to be getting optimistic again. On the private side people still remain quite negative on India because the last five years have been pretty tough and generally speaking private equity has not delivered on India in this vintage. But our view is that was in large part because of an oversupply of capital.”
While Driver admits there are “very serious risks”, which mean firms cannot “indiscriminately invest”, he says that the market has matured and believes there is more opportunity for firms to do control deals in the country, for which Partners Group has a preference.
“There has been a big shift [towards control deals] that has already happened and the trend seems to be strengthening,” Driver said, explaining that entrepreneurs are increasingly willing to sell their businesses as the sense of euphoria subsides, as well as a number of private equity-owned businesses being persuaded by their GP investors that they should sell out alongside the firm in an exit.
The news comes as Partners Group expands its coverage of emerging markets, India being its sixth office in Asia Pacific and seventh in emerging markets, the firm maintaining a presence in Brazil.
“The office opening has been planned for a while and [came as] Partners Group continues to go more and more local across emerging markets and India was in a sense unusual as a big economy where we were active, but not functioning from an office within the country,” Driver added.