BTS floats $80 mn fund for SMEs

BTS Investment Advisors, a private equity firm operating out of Switzerland and India, has floated a $80 million India fund to invest in medium-sized companies that are seeking capital for expansion.

The fund has already received investment commitments from institutions such as Asian Development Bank ($15 million), Swiss Investment Fund for Emerging Markets ($12 million) and a Taiwanese government fund ($5 million).

The fund has selected sectors such as life sciences, manufacturing, engineering, information technology (IT), IT-enabled services, telecom and entertainment for prospective investments. The target companies would be the ones with a turnover of Rs 50-150 crore and an equity base of Rs 5-10 crore.

"Indian economy is registering record annual economic growth (about eight per cent) which could offer exciting investment opportunities. BTS, which has a deep understanding of the Indian corporate sector, will be able to identify investment proposals, Alastair Guggenbuhl-Even, chairman, BTS, said.

The fund would buy minority stakes (15-20 per cent) in companies and the investment will be capped at $1-5 million per company. The fund has a life of 10 years and expects to invest in 10-15 companies over 3-4 years, K Srinivas, managing partner, BTS, said.

The fund has commitments worth about $45 million at present and it is likely to hit $80 million by December. Apart from institutions, BTS has already received commitments from many high networth individuals in Europe and Asia, Srinivas said.

BTS also runs Swiss Technology Venture Capital Fund with a corpus of $22 million since 1997 for investment in Indian SME sector. The total funds managed by BTS Advisors are close to $1 billion, most of it is invested in Indian companies.