SBI to set up private equity funds

The Indian bank is close to setting up a private equity fund with Oman and has also been designated by the Indian government as the ‘operationalising agency’ for a similar fund with Qatar.

The State Bank of India (SBI) “is at an advanced stage in setting up a general purpose private equity fund jointly with sovereign entities in Oman”, according to the bank’s 2008 to 2009 annual report.

The Indian government has also selected SBI as the “operationalising agency for a similar sovereign fund with Qatar”. Several other funds are also being formed, the annual report said.

SBI did not reply to requests for comment at press time.

SBI’s other private equity funds include its Macquarie-SBI Infrastructure Fund (MSIF), which raised $1 billion to invest in infrastructure projects in India this April. The fund aims to raise between $2 billion and $3 billion.

MSIF is a joint venture between SBI, Australian investment bank Macquarie Group and the World Bank’s International Finance Corporation (IFC). SBI and Macquarie each hold a 45 percent stake in the fund and IFC holds a stake of 10 percent. SBI and IFC each committed $150 million to the fund.

In January, SBI entered into an agreement with the India’s state government of Gujarat to raise an INR50 billion ($1 billion; €751 million) infrastructure fund. The fund will invest in the equity of infrastructure projects in the state.

Last year India’s prime minister Manmohan Singh celebrated a preliminary agreement between India and Oman to establish the $100 million India-Oman Joint Investment Fund, during his first visit to Oman. The fund focuses on investments in infrastructure and other sectors of the Indian economy.