Gulf investment firm Investcorp to focus more on real estate after acquisition of IDFC Alternatives PE and RE funds
Mumbai: Investcorp, which is close to acquiring the private equity (PE) and real estate (RE) funds business of IDFC Alternatives, will initially focus on real estate investments, said two people aware of the development.
Investcorp currently manages more than $22.2 billion of assets across asset classes such as private equity, real estate, special situations and credit. It has offices in New York, London, Bahrain, Abu Dhabi, Doha, Riyadh and Singapore.
“Investcorp is in advanced talks to acquire IDFC Alternatives’ PE and RE funds business and is currently conducting due diligence on the funds. The transaction is expected to be closed in a month’s time. Going ahead, the focus of the firm, initially, will largely be on real estate investments and they plan to invest large amounts on capital in the Indian real estate space,” said one of the two people cited above, requesting anonymity as the talks are private.
Investcorp is particularly interested in the real estate part of the business given the quality and the track record of the current team managing the real estate fund, this person said.
“Investcorp has a large real estate investment business and they can leverage those limited partner connections and expertise in investing in mature markets such as the US for building a large real estate franchise in India,” this person added.
According to Investcorp’s website, since 1996, the asset manager has completed more than 300 property investments totaling more than $11 billion in value.
According to the second person, Investcorp will continue with the current teams managing the two fund businesses. He too requested anonymity.
Investcorp and IDFC Alternatives declined to comment.
On 22 May, News Corp VCCircle reported that Investcorp had emerged as a front-runner for acquiring the PE and RE businesses of IDFC Alternatives.
IDFC Alternatives last launched a real estate fund in 2016—its third real estate fund—raising Rs760 crore from domestic investors. Its first fund—IDFC Proprietary Office Fund—of Rs700 crore was raised in 2011-12 and has been completely exited. In 2014, the firm raised a Rs750 crore IDFC Real Estate Yield Fund.
On the private equity side, IDFC Alternatives is currently managing four funds with investments in companies such as dairy company Parag Milk Foods Ltd, Staragri Warehousing and Collateral Management Ltd and GMR Energy Ltd.
IDFC Group has also recently sold control of the infrastructure investment arm of IDFC Alternatives to US-based infrastructure investor Global Infrastructure Partners (GIP).
The infrastructure portfolio of IDFC Alternatives consists of two funds. The two funds have collectively invested about $1.4 billion across infrastructure assets in roads, power, telecom tower and renewable energy sectors.
IDFC’s is not the only alternative asset management platform that has seen change of control recently.
On 21 May, Mint reported that The Rohatyn Group (TRG), a specialized asset management firm focused on emerging markets, has acquired the J.P. Morgan Asian Infrastructure and Related Resources Opportunity (AIRRO) platform.
The AIRRO funds currently hold approximately $750 million in Indian assets across investments spanning the toll road, thermal power, renewable energy, and social infrastructure sub-sectors.
Source: livemint
