India-centric funds will take its asets under management to $500 mn, from $100 mn now.
The BTS group, a Swiss private equity (PE) fund manager, plans to launch two funds in India over the next 2-3 years to expand its assets under management to about $500 million from about $100 million at present. A top executive close to the development said the size of each of these funds would be $200-300 million.
“BTS has gained an expertise in pharmaceutical and life sciences sectors and would prefer to leverage its strength in these areas for raising PE capital for the next few funds that are in the pipeline. The PE funds raised by BTS are always invested with a diversified approach across companies with varying businesses, but excellent growth potential. Information technology, telecom, media, logistics, and engineering are a few other sectors, where BTS intends to invest from the upcoming funds,” said the executive.
Sources said BTS would invest the corpus of these two funds in 15-20 companies, mostly in their early-growth stage. The funds would invest about $10-15 million in each of these companies.
“BTS intends to gather about 10 investors for each of these funds. The investments are made over a tenure of up to five years and the life of the funds is typically 8-10 years,” added the source.
The company, which has already floated two funds — Swiss Tec Venture Capital Fund (about $22 million), and BTS India Private Equity Fund ($80 million) – currently manages assets of around $100 million from these two funds. While the corpus of the first fund has been completely invested across 19 companies, the second fund has been partly invested in six companies so far.
“The funds invested by BTS typically target returns in the range of 20 to 25 per cent, including the fund management expenses. Most of the investors in BTS funds are from the United Kingdom and the investments are mostly made in unlisted companies. The investors in BTS’ funds typically include large financial institutions and government pension funds. The minimum investment would be kept at $1 million for subscribing to the BTS group’s forthcoming funds,” the executive added.
The Swiss PE player is also mulling options of private investment in public equity (PIPE) deals once the equity market stabilises. “BTS did invest in two listed companies from the first fund, Swiss Tec, but now investments in the unlisted space are preferred. The biggest issue in PIPE deals is that you have limited rights about the investments made from the fund’s corpus,” the executive said.
BTS is yet to take a call on the name of the funds that are to be launched.
