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KKR defines the new qualifying criteria | Advantage zyaada

zyakaira notes: Since writing, the Dalmias of Dalmia Cements have replaced Jindals as a KKR portfolio acquisition Dalmia Cements has been attempting a long run restructuring and is probably in a position to leverage the sunrise investment sectors incl wind farms(26m units) and co-generation apart from cements and sugar. KKR has also acquired a Korean Brewery from Anheuser Bosch and last week Usen, a Japanese media company for $359 m

I have long been a fan of my own unique capabilities of filtering, motivating and weaning a new crop of Indian and global leadership across identifying sectors, groups, business persons and though I have toiled hard to establish my unique brand without crowdsourcing there are agents of such drivers as myself in this global pool of PE players the George Soros and the others who have been tracking a global crisis or two like the economists and the Barry Ritholtz and Andrew Sorkin kind of brands.


To that list, the original petty larceny artist and known LBO champion KKR had recently been added in this edition of the crisis in 2008 as I heard of Sanjay Nayar moving there at a VC Circle conference in Hyderabad. Of course, since then many have been disappointed, what with the lack of traction in this hyperinflationary track, the loss of developing market status and tougher market winds fighting with China and even the new Mexicans and South Africans for the same petty share of world trade that defines India for example.

Though we have built quite a few telling tales in the last two years most like upcoming financial regulation week have been dud-of-duds and boring repetition to the point that this seems like a dull corner of the global timeline for financial markets where Greece’s downgrades and the consequent ones in Spain and even the goalless draw of Portugal by Ivory Coast ranks next to mundane not so hot times..

You can see your parcel of work could be pretty useful..but back to the moot point.

First Max & Analjit Singh and then Jindals esp Jindal SW

Of course Coffee Day’s VG Sidharth and GMR Infra also went thru a few financing rounds; Tikona and Infotel managed to define a new industry space with Wimax and LTE ; Telecom got a new continent with Sunil Mittal getting out to a new wicket after a 600 million market in india gave Bharti Airtel a 25% market share to go; and Mahindras, Coal India and Reliance made a couple of overseas wins and some gas agreements (very close to it!)

The new crop of Indian majors that plan to defy gravity and look to an unknown quantity of karma from the larger indian audience to pip them to the post in each foreign acquisition and each new oil well purchased or sold have now a defined quantity of support in each with such defined channels under the surface that connect investors, working professionals and even Sachin Tendulkar and Force India backers worldwide and Indian Financial Media steps up to the plate with remarkable alacrity and all round coverage nowadays. It has also become extremely tough to set up a new venture, get funding and get market traction to build a new giant for the masses to track and hail as the new champion with even lifestyle plays like Cox and Kings and gym major Talwalkar’s roping in funds worth $20-50 million where ticket sizes were hardly 4 or 5 million earlier..

The Investment Banking fraternity thus can now afford to operate from a copy book style, with PE giants opting out of startups for corporates with a 5 yr and more profitable ventures and IPO and PE tickets in $100s of millions from the few million that now come from incubators like Y Combinator where startups can look to living off a stipend. The distinction is necessary to observe and define KKR’s operations in India, earlier working with Temasek on a couple of deals and then choosing a select few for $100 million and options for downward second tranches. Elsewhere PE instruments offer immense flexibility for locating and funding unlisted start ups thru the vagaries of down and even consistently under par economic cycles that define in the money options for those venturing out to farm the till and grow the will.

Jindal Southwest has uniquely market priced EV multiples for its businesses in Steel and Energy and expansions include North Karnataka in Bellary with the mandatory 6MT Steel plant in Mittal’s new neighbourhood and its own Power transmission and Distribution operations. Th Jindal expansion operation would however vbe still steeped in the more cash strapped traditional indian business than most with ot without the KKR millions. Analjit Singh’s choice of business and sectors offer a better growth and diversification opportunity at this juncture and both constitute a true VC mould for the next Indian big one, well behind but firmly in VIP seating rubbing shoulders with the Airtel Bharti ventures and the Ambanis’ new plans for Telecom, Energy and Transport

[Tag India, India Infrastructure, Private Equity]

2 comments on “KKR defines the new qualifying criteria | Advantage zyaada

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This entry was posted on June 16, 2010 by in Financial Markets, India, India Infrastructure, Indian Stocks, Private Equity and tagged , , , , .


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