Signs of the times

In a sign of the times for private equity in western markets, the FTSE 100 listed 3i investment group, recently reported a 30% slide in proceeds from asset sales and exits in the past year. "Realisation" proceeds fell from $4.7billion to $3.3 billion during the year to the end of March as a tougher market for credit put the block on big-ticket sales of assets.

In a further sign of the shift in focus towards emerging markets, 3i signalled its confidence in India by fundraising for an Indian-focused infrastructure fund with $1.2 billion in commitments last month. The fund was the third-largest India-focused fund behind $1.3 billion vehicles from ChrysCapital and Urban Infrastructure Venture Capital.

Michael Queen, managing partner and head of 3i’s infrastructure practice and a speaker at the Private Equity Forum, said: “Our involvement in India has been incredibly exciting both on the private equity and the infrastructure side. This fund is probably one of the easiest we’ve ever had to raise, due to the enthusiasm from investors towards the infrastructure opportunities in India. We could have raised a lot more.”

There are more sizeable funds in the pipeline including a $5 billion vehicle from IDFC Private Equity and a $3 billion fund from ICICI Venture. Investment bank Morgan Stanley has opened a private equity unit in India that will invest capital from the bank’s third Asian fund which manages $1.5 billion.