Technology, Venture Capital, Private Equity

Perspectives from an Indian VC

Archive for the ‘private equity’ Category

LBOs demystified

Posted by Arun Uday on September 7, 2007

Given all the publicity (both positive and negative) that PE firms are getting these days in the media, some of the industry related vocabulary seems to be coming into the fold of common parlance. One such term that seems to have successfully garnered some popular attention (in India), thanks to the likes of Tata (Corus) and Birla (Hindalco) who have been famously employing it for their acquisitions is – “Leveraged Buyout” or “LBO”. When people learn about my PE affiliations, the question I sometimes get asked is – “What is this LBO thingie?” Now, who’s to explain that what I do in my job here is strictly not the financial engineering driven LBO stuff that Wall St. PE buffs are famous for (and nor is it strictly Silicon Valley style “VC”. So, what’s it that I do? – Will save that for another day…). Nonetheless, I can’t work in a PE firm and appear to be not knowing what an LBO is. So, after stretching my imagination a little, I contrived a real estate analogy to explain the same, which has met with a fair degree of success as far as a satisfactory response to the enquirer’s query goes. And it goes thus. Read the rest of this entry »

Posted in LBO, private equity | 9 Comments »

Why private equity is going public

Posted by Arun Uday on July 18, 2007

The recent Blackstone IPO and forthcoming KKR IPO has got the whole world speculating on the reasons why PE firms are going public. Various folks have conjured numerous theories, some authentic, some not so authentic. These range from PE firms trying to exploit the liquidity in global equity markets to senior partners cashing on the high valuations that these firms are now able to command etc. Before I share my $0.02 on this, a quick question to the reader – which is the largest well known public principal investor (clue: it is not a fund house)? Answer – Goldman Sachs. This brings us to an important theme which is playing out in the global financial world today, which is the obliteration of the line between the principal and agent, something that has not been as well analyzed by most (in the context of PE firms going public) as it warrants (IMO).
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Introducing HSBC Private Equity

Posted by Arun Uday on April 23, 2007

HSBC Private Equity is a professionally managed group of Private Equity Funds under the HSBC umbrella. In Asia, we are currently managing two funds, headquartered in Hong Kong. Both are pan Asia funds, mostly focused on China, HK, Taiwan, S. Korea, Singapore, Asian Tigers and India. No specific geographic allocations (more opportunistic and driven by attractiveness of the opportunity). Other details as follows:
Fund 1: USD 700 million in size. Sector agnostic. Ideal deal size : $30 – 100 mn.
Fund 2: USD 120 million in size. Primarily focused on tech and related sectors. Growth or expansion stage (preferably avoid very early or seed stage). Ideal deal size : $3 – 10 mn. But, we do have a broad definition of tech. It could include companies that have a significant application of tech rather than just producers of tech.
In India, the team is headed by Rajeev Kalra, an industry veteran, who has been with HSBC PE for more than a decade now and Arun Uday, who recently joined the team and will primarily advise on technology related venture investments in India.

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