Frontline launches $200 mn SME fund

Frontline Strategy Limited, a Mauritius-based Private Equity fund, has launched a $200 million (Rs 794 crore) fund for the Indian small and medium enterprises sector.

The India Industrial Growth Fund will invest $10-12 million primarily in the unlisted space. This is Frontline's second fund, the first one being Strategic Venture Fund with a corpus of $85 million.

IIGF's broad target investments would be companies that are in the early stages of the PE investment space, primarily in the industrial sector and with revenues between Rs 200 million and Rs 1 billion.

The fund is in talks with global investors. However, the Fabiani family is a major investor in this fund along with the founder partner, Atim Kabra.

The Fabiani Family have been investors in India since 1999. Some of their notable private equity investments have been Indiabulls, Edelweiss, Nimbus, TV18 and Avendus. Besides this, they have extensive interests in real estate, both in India and Spain.

Through their Strategic Venture fund, the Frontline Group has invested in Astra Microwave Products, a manufacturer of high-end microwave and RF based components for defence, space and civil telecom applications; Titagarh Wagons, India's leading private manufacturer of railway wagons; CbaySystems Inc, the third largest healthcare BPO service provider in the US and India's largest; Alfa Transformers, a manufacturer of power, distribution and furnace (specialty) transformers; and Shilpa Medicare.

The fund house is targeting a 25 per cent return from this fund over 3-5 years.