Technology, Venture Capital, Private Equity

Perspectives from an Indian VC

HSBC Private Equity invests in Avitel Post Studioz

Posted by Arun Uday on June 3, 2010

Avitel Post Studioz Ltd, a Mumbai-based company providing post-production and related services to the media & entertainment industry, has raised Rs 50 crore from The HSBC Asian Ventures Fund 3 Ltd, a $700-million closed-end fund for private equity investment in Asia. The fund is advised by the HSBC Private Equity Asia Ltd (HPEA) Group.

With this, James Savage, a director at HPEA, will join the board of Avitel, said a company statement. Standard Chartered–STCI Capital Markets Ltd acted as the sole financial adviser in the transaction.

Avitel has raised the fund to expand its business as it plans to utilise the capital to establish an export oriented unit for animation and post production services, as well as scale up its existing facilities catering to the domestic film and advertising markets. The company also plans to recruit around 300 professionals in the next two years.

Avitel launched its operation 35 years ago, and currently has a strong presence in the domestic post production market, focusing both on feature film and advertising industry. The domestic post production and visual special effects industry in India is estimated at Rs 1,000 crore, and is expected to grow at a CAGR of 18% over the next 3-5 years, added the statement. Avitel is also planning an initial public offering (IPO) over the medium term.

Besides post production activities, Avitel also offers film archiving and restoration services for clients in both domestic and export markets. The company is currently working with the Information and Broadcasting (I&B) Ministry of India, and some other overseas television channels for library restoration.

Avitel has also recently diversified into the animation market, and has been developing an animation project with a British film production company, including creative and pre-production for the overseas markets.

Pradeep Jain, chairman, Avitel Group, said, in the statement, “With animation work orders worth Rs 150 crore in hand, we plan to recruit around 300 professionals in the next two years in areas of script writing, direction, production set-up, production pipeline design, animation skills and management, to match the timeline for our global projects.”

Alok Gupta, director and head of Venture Investment at HPEA, said, “The management team has demonstrated great operational skills in building a robust and diverse business model. We intend to support Avitel in its growth and expansion plans through our network and reach in other Asian markets.”

HPEA is the Asian private equity arm of the HSBC Group. It advises both expansion capital and buyout focused private equity funds as well as venture funds. While the private equity funds focus on mid-market expansion capital and buy-out transactions in Asia, the venture funds focus on small and mid-sized technology and consumer focused companies.

2 Responses to “HSBC Private Equity invests in Avitel Post Studioz”

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