Singapore-based secondaries specialist Basis Non-public Fairness has acquired the entire Restricted Companion (LP) pursuits within the first fund of early-stage enterprise capital agency Prime Enterprise Companions.
It is a uncommon transaction within the enterprise capital (VC) and personal fairness (PE) trade in India the place LP curiosity has modified arms on the fund degree itself.
In an announcement, Prime Enterprise Companions mentioned that the transaction has helped ship a wholesome, top-decile return to its LPs in its ninth yr of operation and has additional prolonged the fund by 4 years. Apart from, Basis Non-public Fairness has now turn out to be the only real LP in Prime Enterprise Companions’ first fund, it added.
Individually in an interplay with VCCircle, Sanjay Swamy, Co-Founder and Managing Companion, Prime Enterprise Companions, mentioned that the transaction has delivered 4 instances returns to its LPs.
Prime Enterprise Companions had launched its Mauritius-based first fund of $8 million in 2012. The fund’s LPs included enterprise capital agency Mayfield, Chamath Palihapitiya’s Social Capital, Yahoo co-founder Jerry Yang and different excessive internet price people (HNIs) from the Silicon Valley, mentioned Swamy.
He defined that the transaction confirmed that even with out exiting the portfolio firms, enterprise capital companies can ship on the fund degree itself a “significant exit” to its LPs.
“That’s one thing the market will discover very engaging from an LP perspective. There’s solely change within the length of the fund and no influence on the portfolio companies,” he added.
Prime Enterprise Companions’ first fund portfolio consists of seven companies together with an interactive studying startup Quizziz, which raised a Collection B funding spherical led by Tiger International final yr, and Happay, which was acquired by Kunal Shah led Cred late final yr.
Swamy additionally mentioned that this transaction might discover extra takers within the trade. He added that what labored in favour of Prime Enterprise Companions was its concentrated portfolio.
“Funds which have a small concentrated portfolio and have a significant possession in them can be engaging for such outcomes,” he mentioned. He additionally mentioned that the deal construction might additionally fluctuate and LPs may do a partial exit as a substitute of a full exit.
Jeremy Foo, Co-Founder and Companion, Basis Non-public Fairness, mentioned within the assertion the it has taken a affected person strategy so far with evaluating enterprise alternatives in India, and is now excited to be backing “a really high-quality GP workforce and portfolio” with its first transaction in India.
Candor Asia Ltd acted because the advisor for this transaction.
There have been uncommon cases of a secondaries deal within the PE/VC trade in India the place LP pursuits have modified arms. In March 2018, TR Capital acquired a 50% LP curiosity within the first fund of homegrown non-public fairness agency Tano Capital. The identical yr, Switzerland-headquartered international asset supervisor Capital Dynamics supplied an exit to the non-institutional LPs of the primary fund of Asian Healthcare Fund.
Whereas Prime Enterprise Companions has facilitated full exits for its LPs from its first fund, the enterprise capital agency can also be nearing the ultimate shut of its fourth fund, mentioned Swamy.
Prime Venture Partners had introduced the primary shut of its fourth fund at $75 million in August final yr.
The fourth fund has a goal corpus of $100 million. The early-stage investor closed its second fund price $46 million in 2016 and closed its Fund III in 2018 at $72 million.
Supply: Live Mint