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India Private Equity Summit - Singapore

The role of private equity in growing the ties between India and the Middle East. India Private Equity Summit - Singapore. Jonathan Hall Executive Director. January 23, 2007. Christopher Columbus. The origin of private equity?.

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India Private Equity Summit - Singapore

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  1. The role of private equity in growing the ties between India and the Middle East India Private Equity Summit - Singapore Jonathan Hall Executive Director January 23, 2007

  2. Christopher Columbus The origin of private equity? • Conceived of special incentives (carried interest) to take the trip to the “new world” • All expenses paid • 10% of all profits (no preferred return) • 5% of all gold, and title of Admiral for life • So the profession is old, perhaps not the oldest, but hopefully at least as lucrative!

  3. Turkey Syria Lebanon Iraq Iran Jordan Pakistan Kuwait Egypt Bahrain Qatar India UAE KSA Oman Sudan Private Equity in India and the Middle East Market characteristics Middle East India • High liquidity but lack of investment instruments • Bank focus on assets and name based lending • Need for management talent • Limited domestic markets • Undiversified economies • Extensive family groups / expatriate entrepreneurs / govt. involvement in economies • Evolving corporate and investment laws • Lack of available risk capital • Access to bank finance difficult • Management strength • Domestic market scale • Broad based economy • Active business owners • Established legal framework

  4. Turkey Syria Lebanon Iraq Iran Jordan Pakistan Kuwait Egypt Bahrain Qatar India UAE KSA Oman Sudan Private Equity in India and the Middle East Predominant nature of private equity deals Middle East India • Buyout • Control positions • Active governance • Private companies • Limited foreign capital and international firm focus • Primary exit by trade sale • Growth / expansion capital (limited ‘buyout’ activity) • Non – controlling stakes • Largely passive investor role • PIPEs • Significant involvement of international GPs and LPs • IPO and trade sale exit options

  5. Turkey Syria Lebanon Iraq Iran Jordan Pakistan Kuwait Egypt Bahrain Qatar India UAE KSA Oman Sudan Private Equity in India and the Middle East Current evolution Middle East India • Growth in capital market depth • Influx of management talent • Increasing international focus on region • Economic and industrial diversification • Stock market valuations • Sellers seeking greater value add • Market growth and competition to drive consolidation • Focus on required infrastructure

  6. Turkey Syria Lebanon Iraq Iran Jordan Pakistan Kuwait Egypt Bahrain Qatar India UAE KSA Oman Sudan Private Equity in India and the Middle East Future direction: opportunities and challenges Market and industry maturity Greater range of deal types Expansion of formal private equity into real estate and infrastructure Ongoing increase in cross – border activity: trade, investment, Islamic finance Deal sizes increasing Continuing increase in competition Fewer easy wins Returns will reflect value contribution

  7. ABRAAJ CAPITAL, LEVEL 7, EMIRATES TOWER OFFICES, P.O.BOX 504905, DUBAI, UNITED ARAB EMIRATES, TELEPHONE +9714 3191500 FACSIMILE +9714 3191600 E-MAIL info@abraaj.com www.abraaj.com Middle East Private Equity: Investing in Foresight

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