What are the latest developments in the world of private equity?
Kedaara Capital is one of the top investment management companies in India. In April 2024, Kedaara Capital was said to have closed a fund of close to $1.75 billion called Kedaara IV.
This is said to be the largest fund raised by a private equity firm. This was said to have surpassed Chrys Cap’s 1.3 billion fund called Fund IX, which it raised in 2023. And it’s said that 85% of the fund was secured from existing backers, like CDPQ, CPPIB and OTPP, which are Canadian pension funds.
There were, also, said to be global investors, like Allianz, Asia Alternatives and HarbourVest. It’s said that Kedaara is looking to broaden its investor base demographically and geographically. Asian and Middle Eastern investors are being embraced, it’s said. Plus, Kedaara was said to be limiting individual allocations to no more than 6% of the fund.
According to Manish Kejriwal, Founder & Managing Partner – Kedaara Capital, “Given the global challenges, like lack of distributions, and how the denominator effect has impacted many LPs, we thought some might drop out and the fund raise would take a better part of the 2024 calendar year, but we had an almost 100% subscription rate”.
So, there were said to be global challenges and investor concerns, but in spite of that, there’s said to be strong investor confidence. It’s said that marquee global funds are increasingly turning their gaze towards India. What’s the multiplier effect of this going to look like, when it comes to India’s growth and development? Could this help reaffirm India’s status as an FDI destination?
And should investments have explicit emission-reduction goals set? KKR co-head of global climate Emmanuel Lagarrigue has an interesting perspective on this. Not the Kolkata Knight Riders, but Kohlberg Kravis Roberts.
According to him, emission-reduction goals could make investors concentrate on limited tech. That could potentially undermine the profitability of energy transition. So, according to him, if investors solely fixate on reducing emissions, they may overlook promising opportunities that drive sustainable growth and profitability.
So, what does Laggarigue want to do instead? He’s said to be advocating for an approach to focus on decarbonizing high-emissions sectors and economies.
There’s something called “the valley of death”, it’s an informal phrase. This is where climate-tech companies, who have derisked their tech, validated their unit economics, begun generating cash flow and created entry barriers, require substantial capital to grow. Which is where they’re stuck.
Laggarigue wants to focus on targeting this stage of development and provide financial resources for companies at this juncture.
Can profitability drive climate action? And what does it take for India to decarbonize high-emission sectors? This could help with India’s climate goals and push for investment in clean energy infrastructure.
And how were the deals targeting satellite companies in 2023? It seems like private equity backed nearly 50% of these deals in the US.
According to S&P Global Market Intelligence and Crunchbase data, 53 out of 108 M&A deals and funding rounds in the satellite industry were backed by PE/VC firms.
So, there’s a growing allure, when it comes to space-related investments. There’s said to be a decreasing cost of space launches. Plus, there’s said to be a shift towards mass production and standardization in satellite manufacturing.
Once satellites are in orbit, valuable data could be provided to commercial and government clients. National security concerns may have, also, played a role in boosting investments in the satellite space. Geopolitical tensions, like the Russia-Ukraine and US-China conflict, may have played a role. So, governments, globally, could be more reliant on satellite tech for communication, surveillance and gathering intelligence.
Could this help India cement a position as a leader in space tech, especially with its Chandrayaan-3 mission and successfully landing on the Moon’s south pole in 2023? How could India unlock its full potential in the satellite industry?
And as of May 3rd 2024, now you know.
