Exclusive: Guruji.com, an Indian local search firm, is believed to have landed Series B funding from Sandstone Capital, a Boston based venture capital firm, VC Circle has learnt. The investment, according to industry sources, is a little lower than $10 million. An email to Guruji’s Co-Founder and CEO Anurag Dod to confirm the deal has not seen a response yet.
Guruji was seed-funded by Sequoia Capital India, besides a small personal investment from Suvir Sujan, a former co-founder of Baazee.com and now managing director of venture fund Nexus Capital India. In December last year, Sequoia had announced a funding commitment of $7 million in Guruji. It’s not known how much money has Sequoia finally put in the company.
Sandstone Capital is a leading US-based, India-dedicated investment fund. The fund manages capital for US and European universities, foundations and families. Sandstone had led a $20 million round in optical networking company Tejas Networks last year.
Now the local information companies that have secured series B funding include AskLaila or Four Interactive (it raised $10 million in series B from Lightspeed Venture Partners, Silicon Valley Bank and the existing investor Matrix Partners India) and JustDial (which secured $8-10 million in series A funding from SAIF Partners, after which it raked in another $15 million from US-based Tiger Fund.)

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This is hot from the conference call with Ajit Nazare and Ray Lane, the partners of Kleiner Perkins Caufield & Byers. The fact that the firm organised a call with Indian journalists on the partnership between Al Gore’s Generation Investment Management shows that India is on their radar as far as cleantech investments are concerned.
Kleiner Perkins makes early stage venture capital investments (from its 12th fund of $700 million), while Generation, which has $1.5 billion under management, makes public market deals in sustainable energy businesses. Now both have joined hands and will make combined investments or will look at synergies in deals.
Kleiner’s Nazare said at the conference call that they are seriously looking at a few deals in solar and distributed generation (for instance biomass gassification) in India. “There are numerous opportunities in early stage,” Nazare said, adding, “we will make investments in couple of them.”
But Kleiner’s interest is global and the only criterion for making the investment is that they should be the best breakthrough for the energy problem globally. So the entrepreneurs will be competing globally for Kleiner’s money. Also, there is no fix on the deal size although they typically invest $3 million to $10 million in a company. “It’s not so much the deal size, but it’s the quality of the venture that we usually look at,” Lane said.
Kleiner has dedicated $200 million of $700 million for cleantech investments.

Related:
Kleiner Perkins Takes On Al Gore As Partner; To Up Cleantech Investments

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It seems this deal is almost done. Bangalore-based Amalgamated Bean Coffee Trading (ABCTL), the owner of India’s leading coffee chain Cafe Coffee Day, is raising $95 million (Rs 340 crore) from Deutsche Bank and Templeton Darby International, reports The Economic Times. The capital will be mainly used to expand the retail business Cafe Coffee Day. The firm currently has 480 cafes in India, which will be expanded to 1,000 cafes by 2009.
The report further says the two investors will take a little over a 10 per cent stake in ABCTL’s retail business. Deutsche Bank may invest $70 million while Templeton Darby International may bring in the remaining $25 million. The Rs 400-crore ABCTL was founded by V G Siddhartha. ABCTCL had last year raised $20 million from Sequoia Capital India and $15 million (equity $5 million and debt $10 million) from International Finance Corp (IFC).
Cafe Coffee Day has outpaced competitors like Barista in the number of outlets as well as profitability. C Sivasankaran, who owned Barista, sold the company last March to Italy’s Lavazza for $125 million. Starbucks was rumoured to be planning an entry into India in partnership with Planet Retail, however, we haven’t heard anything from the coffee chain giant lately. Single brand outlets can have a maximum of 51 per cent stake foreign direct investment.

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World’s leading venture capital firm Kleiner Perkins Caufield & Byers has taken Nobel laureate Al Gore as a partner. The hire is part of a global collaboration between KPCB and London-based Generation Investment Management of which Al Gore is the co-founder and chairman. Al Gore’s joining will give an increased thrust to cleantech investments of KPCB.
KPCB will co-locate its European operations to Generation’s London offices. As part of the deal, KPCB’s partner John Doerr will join Generation’s advisory board.
The partnership will provide funding and global business-building expertise to a range of businesses, both public and private, and to entrepreneurs, a statement said. KPCB will continue to invest in startup venture capital; Generation will continue to invest in global public equities. The two teams will collaborate on opportunities spanning sectors such as renewable energy technologies, building efficiency, cleaner fossil energy, sustainable agriculture and carbon markets.
Gore announced that as part of the agreement between the two firms, 100 percent of his salary as a Partner at KPCB will be donated directly to the Alliance for Climate Protection—the non-partisan foundation he chairs that focuses on accelerating policy solutions to the climate crisis.

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ICICI Venture has invested $10 million in RG Stone Urological Research Institute, a super specialty urology hospital. The group will use the funds to establish 20 new hospitals. The first phase includes a super specialty hospital with state of art technology in Goa and four speciality centres in tieup with hospitals like S K Soni Hospital, Jaipur, Kamyani Hospital, Agra, Saguna Hospital, Bangalore and Ivy Hospital, Mohali. The projects are expected to be completed by the end of December 07. The second phase, expected to be completed by September, 2008, will see the addition of 15 centers.
The company, which started with one hospital in Mumbai in 1986, now owns and manages 6 hospitals in New Delhi, Chennai, Mumbai Ludhiana, and through a joint venture in Kolkata.
Almondz Global Securities Ltd, Delhi was the financial advisor to RG Stone for the transaction. Dr B.S Bansal is the Chairman and Managing Director of RG Stone Urological Research Institute.
Some of the recent private equity deals in healthcare services include Actis’s $16 million investment in Ahmedabad’s Sterling Hospitals, Indivision’s in Hyderabad’s Global Hospitals, IDFC Private Equity Rs 50 crore ($10.8 million) in Bangalore-based Healthcare Global Enterprises (HCG), an oncology care chain, IDFC PE’s $20 million in Manipal Health Systems, and the pre-IPO deals in Delhi-based Fortis.

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Sequoia Capital India is believed to have invested about $2 million in an in-store media company Digital Signage Networks (DSN). R Ramaraj, a senior advisor of Sequoia Capital India, is on the board of DSN. Industry sources said that the firm has got two or three contracts which includes one with Cafe Coffee Day, India’s largest coffee shop chain. DSN runs the digital posters (non-audio) put up on Cafe Coffee Day outlets. The details of other contracts are not available.
DSN will be the fifth venture funded company in the digital signage business in India. Recently, VC Circle reported the funding of Delhi based Live Media by Draper Fisher Jurvetson. Intel also last month announced the funding of Tag Media Network. Matrix Partners India has funded $4.5 million in vJive Networks, while the Mumbai-based OOH Media is backed by private equity fund 3i.
Digital signage companies set up TV screens in retail stores, public places like recreation centres and malls, where they will show content interspersed with advertisements. vJive and Tag Media Network are focused on retail stores. Tag Media has clients like Fabmall, Trinethra, Foodworld and Spencers. vJive has a tie-up with Subiksha, among others. OOH India sets ups screens both in-store and recreation centres, malls, elevator lobbies, and so on.
LiveMedia focuses on quick service restaurant chains like TGIF which caters to young and captive audience. They have some 1,500 installations across the country.

Related:
Draper Fisher Jurvetson Invests In Out-of-Home TV Company LiveMedia
Intel Capital Invests In In-Store TV Network Tag Media
Matrix Partners India Invests Rs 20 Crore In Digital Signage Company vJive

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Vijay Mallya, who himself has been on an acquisition spree in the spirits as well as airline business, is reportedly considering a deal to sell a small stake in his flagship United Spirits Ltd to global rival Diageo. The world’s largest spirits maker Diageo is apparently interested in picking up a minority stake in Mallya’s liquor company USL, reports The Economic Times. The report, quoting unnamed sources, said that Diageo could buy around 10-13 per cent in USL for $500-600 million. This will value USL at about $5 billion, while the company is currently valued by stock market at $4.5 billion or Rs 18,281 crore.
It further said a transaction could be expected by early next year, around February or March. The Bangalore-headquartered company has, however, denied any deal. Diageo India MD Asif Adil said he would not comment on speculation.
In May this year, USL had acquired scotch maker Whyte & Mackay for $1.18-billion. A month later, Mallya’s Kingfisher Airlines bought out a majority stake in India’s largest low cost airline Air Deccan. In 2005, Mallya bought bought out his longstanding Indian rival Shaw Wallace & Co fro the Chhabrias for Rs 300 crore. If the latest news is true, it’s not just buying companies in Mallya’s genes. He can sell too.

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The rumour is back again. This time, as media reports suggest, it’s Wipro that is planning a bid for France-headquartered IT giant Capgemini. In June this year, there were rumours of Infosys making a bid for Capgemini. Wipro is now reportedly looking at a 60 euro-per-share bid for CapGemini, which will value the IT consulting giant at 8 billion euros.
However, Reuters reports that Wipro has denied any comment on the acquisition buzz. “We don’t react to market speculation,” Wipro’s spokeswoman told Reuters. The Economic Times quotes Sudip Nandy, chief strategy officer, Wipro, as saying that “it is market speculation.”
Reports, however, suggest that Wipro was indeed in discussions with Capgemini for a cash-plus-stock swap deal. The buzz had its effect on CapGemini share prices which rose 3.7 per cent on Friday. Wipro’s largest acquisition so far was that of Infocrossing for $600 million.
In the case of Capgemini, Wipro will have a huge challenge of managing the integration. The Bangalore-based company has around 77,000 people while CapGemini has over 80,000 of which 17,000 people are in India. The French company plans to employ over 40,000 people by the end of 2010.

Related:
Infosys Rumoured To Be Mulling Bid On Capgemini

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Chennai-based Scientific Publishing Services Pvt Ltd (SPS), a provider of premedia, typesetting, content and publishing solutions to scientific publishers, is reportedly selling out. The company, majority owned by Germany’s Springer Science+Business media, is said to be a target of Indian IT biggies like Infosys and Wipro, big outsourcing shops like Genpact, WNS and FirstSource, besides a host of private equity funds like Carlyle and Blackstone. The deal may be valued at $100 million, according to The Economic Times.
SPS employs around 1,400 people in Chennai and Bangalore. The company was founded in 1995 by Sharad Wasani in partnership with Springer Verlag who then picked up a majority stake. Springer is the world’s second largest publisher of scientific journals and a specialist content provider to the science, technology and medicine sectors. The company is currently owned by European buyout firms Cinven and Candover.

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Hyderabad continues to witness private equity action. The city based engineering and construction group Ramky is set to get $100 million from Lehman Brothers, according to The Economic Times. One of Ramky group companies, Ramky Infrastructure, had early this year received $28 million (Rs 125 crore) in return for 13.5 per cent stake from IL&FS Investment Managers (IIML) and UAE-based Sabre-Abraaj Private Equity Fund I (see details of this round here).
According to ET, in the current round, Lehman is expected to pick up 10 per cent, which values the group at $1 billion. The group turnover is said to be Rs 1,600 crore ($400 million). This investment will be at the group level, and the capital raised will be used to expand operations of its subsidiary Ramky Enviro Engineers in India and overseas, besides for acquisitions, says the report. Ramky is looking at expanding in Singapore and Middle East, and is also looking for mid-sized acquisitions in these regions.
Another city based company, MTAR Technologies, recently raised $65 million from Blackstone. In January this year, Hyderabad based Indu Projects had raised Rs 150 crore from Citigroup Venture Capital. Similarly, in September, KVK Energy & Infrastructure received $26 million from Old Lane Fund.

Related:
Ramky Infrastructure Gets $28 Million From Sabre-Abraaj, IL&FS Investment

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Shalimar Paints is reportedly an “ideal buyout target” for private equity funds, Mergermarket (via The Financial Times) reports, quoting sources. A private equity fund is believed to have shown interest in the company. The report also quotes company sources as saying that the century-old Shalimar would be keen on entertaining offers from PE funds. It could also look at selling either a minority or a majority stake, depending on the deal.
Last year, however, it was reported that Shalimar could be interested in receiving offers from trade buyers. Shalimar has revenues of $73 million, and it’s owned by the Jindal group (the steel business group) and the Hong Kong based NRIs Jhunjhnuwala group. It has a capitalisation of $38 million.

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Hyderabad is getting its third private equity fund to be headquartered there. The city, where there has been a lot of private equity action lately, will be the base for Baseline Partners Ltd, which has made an entry into India with $100 million corpus. The fund is launched by US based investment firm Wexford Capital LLC, which has assets worth $7 billion under its management.
Hyderabad is already the headquarters for iLabs Group (now called Peepul Capital) and SAIF Partners (technically headquartered in the city with two members of the team in the city, although its chief Ravi Adusumalli stays in California and Principal Vibhor Mehra libes in Delhi).
Baseline will look at investments in the range of $10-25 million in medium-sized companies over the next one year. Howard Endelman, Partner, Baseline Partners, has been quoted as saying that they would be open to increasing the corpus from $100 million if there are good investments. Baseline has already identified four to five potential investments in the power, real estate and life sciences sectors in India, all based in Hyderabad.
Wexford manages four hedge funds with $4 billion in assets under management. It also manages a series of PE funds and has invested over $3 billion in private equity, focusing mainly on energy and natural resources, transportation and life sciences companies. Ramesh Babu Byrapaneni is one of the partners in India.

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India’s largest mobile value added services company OnMobile Global’s IPO is set to hit the markets. CRISIL has assigned Grade 4/5 to the proposed IPO of the Bangalore-based company. This grade indicates that the fundamentals of the issue are above average relative to other listed equity securities in India.
According to reports, OnMobile Global is planning an issue of 10,900,545 equity shares of face value Rs 10, which will see a mop up of anywhere between Rs 350-450 crore ($88.6 million-$114 million).
Positives: The grading has seen a few positives: one, OnMobile claims to be the largest player in the mobile value-added services market in India. Second, it has a strong presence in the voice portal and ring back tone segments of the VAS market.
Recently, the company had acquired France’s VoxMobili for $35 million which has given access to the latter’s mobile phone backup solutions.
Negatives: The grading has been tempered because OnMobile has low bargaining power with its customers–telecom operators, as it does not brand its products and depends on the operators to take its products to the market. The grading also reflects the anticipated change in OnMobile’s revenue profile, as it opens up its proprietary platform to third parties for applications development. This will cause the business mix to move from current content cum platform mix to more of the latter.
Revenues: OnMobile Global reported a net profit of Rs 33.7 crore on a turnover of Rs 133 crore for the year ended March 2007. In 2005-06, the company posted a net profit of Rs 24.8 crore and revenue of Rs 82.6 crore.

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Movie exhibitors like PVR Cinemas and Shringar Cinema have raised capital in the past from ICICI Venture and India Value Fund, respectively. Both the companies have gone public successfully and delivered returns to the investors. Now movie distribution companies like Shemaroo Entertainment and Venus Movies are reportedly in talks with private equity funds for capital. According to The Economic Times, Shemaroo is looking to raise about Rs 100 crore, while what Venus’s plans are not known.
Shemaroo, besides distributing films, also has the satellite and cable rights for over 700 films, VCD and DVD rights for over 1,000 films and the terrestrial television rights (India and rest of the world) for more than 150 films, adds the report. It’s not a pure film distribution play. The company also plans to get into film and animation content.
Movie distribution is of course a bit riskier than the exhibition business as they have to buy the rights of the film without actually knowing the fate of it at the box office. But that is one part of the value chain of the growing entertainment market in India, which is estimated to touch Rs 17,500 crore by 2011 from Rs 8,450 crore in 2006. Not sure, though how many firms will be interested in funding pure distribution companies.

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This is the first private equity deal in the defence and nuclear space. The US private equity fund Blackstone has announced an investment of $65 million in the Hyderabad based MTAR Technologies Pvt Ltd, a company that provides components to the Indian defence and aerospace establishment. The funding will be a mix of primary and secondary equity. Some media reports suggest that Blackstone has picked up 26 per cent stake in the company. MTAR will continue to be led by the original founders - P. Ravindra Reddy, Satyanarayana Reddy and P. Jayaprakash Reddy - who will retain a 74 per cent stake.
MTAR manufactures precision machined parts for nuclear power reactors, and engine and structural components for aerospace and defense applications. It has clients like Nuclear Power Corporation of India Ltd, Indian Space Research Organisation, and Hindustan Aeronautics Ltd, all in the government sector.
Akhil Gupta, Chairman of Blackstone Advisors India Pvt Ltd, said: “MTAR is a sector leader with very unique skill-sets, capabilities and in-depth understanding of a very niche and high potential industry. We foresee a huge growth opportunity for MTAR both in domestic and global markets.”
MTAR has apparently indigenously developed a grid plate technology to be used in the 500 MW prototype fast breeder nuclear reactor project coming up at Kalpakkam in Tamil Nadu. The company has won awards from the Defence Research and Development Organisation for defence absorption. The deal is subject to regulatory approval. First Securities was the advisor in the transaction.
The Economic Times adds: According to MTAR chairman P Ravindra Reddy, the funds will be used for the expansion of their manufacturing facility for nuclear and aerospace apart from diversifying into oilfield equipment. Currently, the company has an order book of Rs 250 crore executable over two years. MTAR’s revenues are undisclosed, but the management is aiming to raise it four to five times by 2010.

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