In a major shakeup at one of the most respected private equity funds in the country — Sequoia Capital India — four managing directors are set to exit and set up their own fund.
Private equity industry veterans K P Balaraj, Sumir Chadha, Sandeep Singhal and S K Jain are understood to be forming a fund that will primarily focus on private investment in public enterprises and late-stage deals.
According to investment bankers in the know, Sequoia executives have briefed some investee companies about the exit of the four key personnel. According to private equity industry players, they are understood to be planning to revive WestBridge Capital Partners after their exit from Sequoia.
WestBridge, K P Balaraj’s earlier fund, merged with Sequoia in 2006, upon which he joined the latter firm. WestBridge had previously raised two venture capital funds of around $200 million and $150 million each with the Khemkas’ Sun Group as anchor investor.
Prior to co-founding WestBridge, Sequoia MD Sumir Chadha was a member of the Principal Investment Area at Goldman Sachs. Prior to that, Chadha worked with McKinsey & Co in New York and New Delhi.
Sequoia manages around $1.8 billion in India spread across various funds: Venture capital, growth and late-stage funds. In late 2008, Sequoia India closed a $725-million growth fund second tranche, after its initial fund of $400 million.
Investment bankers in the know say limited partners who are investors in various Sequoia funds were not too happy with how the returns panned out, when compared with the India and China funds. “The arbitrage in China is pretty good, but not in India in relative terms. This may be one of the reasons,” a private equity industry player told Business Standard.
Sequoia officials were not reachable for comment on any of these developments.
After the exit of these four, Sequoia will be managed by five seniors: Abhay Pande, Shailendra Singh, G V Ravishankar, V T Bharadwaj and Mohit Bhatnagar. Some of its portfolio companies in India include Café Coffee Day, Comviva, Dr Lal Pathlabs, Edelweiss, Firstsource, GVK Biosciences, Idea Cellular, Just Dial, shaadi.com and SKS Microfinance.
