Indian Private Equity Fund (IPEF) which is sponsored by Khaleej Finance of Bahrain is picking 41% stake in Secunderabad-based Shalivahana Green Energy (SGEL) for an estimated Rs 53.94 crore($10.5 million) valuing the firm at Rs 131 crore ($25.6 million). Launched in collaboration with Kuwait Investment Company (KIC), IPEF is a $200 million Sharia compliant Indian focused private equity fund. Besides power sector, IPEF invests in real estate, sugar, cement, iron & steel, pharma, telecom, IT, infrastructure etc targeting IRR of 25%. The fund looks at investment horizon of 3-5 years aiming to more than double the value of its investments in the investment period. According to the deal, IPEF will subscribe to around 34.32 million fresh shares of SGEL, making it the second largest shareholder of the firm. SGEL is into development and operation of renewable energy projects. Its business area include generation and distribution of green energy from biomass, hydro, wind, solar, tidal among other non conventional energy sources. SGEL also has six subsidiaries in which it holds stakes ranging from 26.8% (Pallavi Power & Mines) to 99.99% (Konark Power Project). Other subsidiaries include Rake Power, Shalivahana(MSW)Green Energy, Shalivahana Solar Energy and Shalivahana Wind Energy.
In the meantime, VCCircle learns that one of the existing investors-- Small Is Beautiful (SIB) fund-- is exiting its investments in SGEL. SIB is backed by investments from various domestic public sector banks and financial institutions. Its investment advisor is KSK Energy Ventures.
SIB is currently holding around 33.44% stake representing 14.42 million shares and is selling 6.4 million shares to a Singapore-based fund Pan Asia Infrastructure Asset Management Company Pte. The value of this deal, which would give 7.67% of the expanded capital (after issue to IPEF) to the Singapore based fund is not clear.
The Singapore fund was formed two year back to invest in infrastructure projects in Asia. It already has few other investments in India including Central UP Gas Ltd, Worlds Window Infrastructure & Logistics and IL&FS Waste Management & Urban Services.
The remaining shares held by SIB(around 8 million shares) is believed to be in the process of being sold to the other existing resident shareholders including promoters of SGEL. SGEL is part of Hyderabad-based Shalivahana Group which operates in areas of construction, power, education, eco-tourism and real, estate. Shalivahana Projects is the privately held flagship group company.
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