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Blackstone in India: a lesson for Western private equity firms
By Amarendra Bhushan for CEOWORLD Magazine Updated:January 20, 2009
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What makes Blackstone’s India situation difficult is the speed at which it spent money in a once-red hot economy. The firm is sitting on eight portfolio companies with few exits in sight.
- Blackstone Group (BX.N) has invested more than $730 million in India.
- India’s foreign investing rules, forbid borrowing and set a purchase price range.
- Blackstone launched plans to expand in Asia in 2005.
- Choosing India as its first destination after hiring Gupta from Reliance Industries.
- Shares of Nagarjuna Construction have fallen 71 percent since Blackstone agreed to invest $150 million in Aug. 2007.
- Gokaldas Exports (GOKL.BO) has also lost 71 percent of its value since Blackstone inked a deal that same month for $165 million.
- Blackstone said it would invest $60 million in transportation company Allcargo Global Logistics, Eight months later, the stock was worth less than half that amount.
The India Fund has a team of seven dedicated investment professionals under the leadership of Punita Kumar-Sinha, the group’s Chief Investment Officer and Senior Portfolio Manager.
Ms. Kumar-Sinha is supported by a research advisory team with a combined research experience of 37 years. The team consists of four experienced analysts based in Mumbai, India who manage the day-to-day investment research and fundamental analysis process.
In addition, based in Boston are two qualified analysts who conduct research on selected Indian sectors and companies, analyzing them and making investment recommendations within an Asian regional context.
A senior quantitative analyst works with the team to continuously maintain and refine the quantitative models as well as two equity traders who handle all the trading responsibilities for the India Fund.
Both the Chief Compliance Officer and the overall trade support function for the India and Asia Tigers funds are based in New York.
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