PE deals' valuation surged to $1.8 bn in May: Grant Thornton

New Delhi: The valuation of private equity deals surged significantly in May to USD 1,851 million driven by Qatar Foundation Endowment's USD 1.26 billion investment in Bharti Airtel.

According to audit and advisory firm Grant Thornton, the total PE deals during May were valued at USD 1,851 million through 31 transactions, as against USD 344 million from 26 deals in May 2012, taking the deal tally during the first five months of the current year to USD 4,395 million.

"Private equity deal activity has continued to be steady and May 2013 witnessed a large PE deal wherein a sovereign wealth Fund (Qatar Endowment Fund) acquired 5 percent stake in Bharti Airtel for USD 1.2 billion," Raja Lahiri ? Partner, Transaction Advisory Services, Grant Thornton India LLP said.

Besides the Qatar Foundation-Bharti Airtel deal, other major PE-deals in May include Baring Private Equity's 14 percent stake acquisition in Lafarge India for USD 260 million, Goldman Sachs' 15 percent stake buy in DEN Networks for USD 110 million and Tata Opportunities Fund's 5 percent stake buy in Tata Sky for USD 50 million.

Top five PE deals accounted for 92 percent of the total PE deal values in May, the report said.

Meanwhile, the total PE deal value for the first five months of this year was USD 4.40 billion (through 169 deals), up 43 percent compared to year-ago period.

Lahiri further said that "one of the key focus areas for some large Indian corporates is to enhance financial liquidity and reduce debt levels and we expect more transactions to take place this year by way of either divesting non-core assets or bringing in PE capital."

"We thus continue to see companies divesting non-core assets, for example, Jaypee Group and DLF selling land assets in the real estate space and some of the larger infrastructure groups looking to divest its stake in road assets," Lahiri added.

PTI