Avendus Advisors to divest 20% stake to Old Lane and Mayfield Ventures

Hedge fund Old Lane Partners and venture capital firm Mayfield Ventures may buy around 20% stake in leading boutique investment bank Avendus Advisors for a sum of Rs. 80 crores. This puts the valuation of the bank at around Rs. 400 crores. Avendus is expected to gross annual revenues of $12 mn in 2006-07. The organization has grown from 16 professionals to 40 in 2006.

Avendus was founded in 1999 by Ranu Vohra, Gaurav Deepak and Kaushal Aggarwal. They and employees of Avendus hold around 70% of the bank’s equity stake. Americorp, a Spanish institutional investor, holds 20% and the rest is held by Californian entrepreneur-investor Anil Godhwani. A minority stake earlier held by Infinity Venture, a venture capital fund, had been bought back by promoters around 2 years back.

Recently, Avendus has inducted two senior officials as vice presidents. Kishore Srinivasan, former joint GM and Head, Closely Monitored Assets (CMA) at ICICI Bank, joined Avendus as vice president and is now heading its corporate debt services. Also, Rajiv Shukla, former director, business development, at Pfizer, has joined Avendus as vice president, heading its life science vertical. Mr. Shukla is known to have played a leadership role on 5 acquisitions at Pfizer totaling $63 bn. Just a couple of days ago, Avendus was in the news for the exit of some of its high-profile employees, notably, Deepesh Garg, Assistant Vice-President, Consumer Products and Services Team, and Shiraz Bugwadia, Assistant Vice-President, Pharmaceuticals and Healthcare.

Avendus focuses on wealth management, institutional broking and debt solutions. It offers private equity syndication, mergers & acquisitions (M&A), and strategic advisory services to corporates and funds. Currently, it is in the process of expanding its operations abroad by opening offices in New York and Munich.

Read The Economic Times article.
Related Post: Key senior people exit Avendus Advisors to float boutique investment bank

Foreign investors pick 20% stake in Edelweiss Capital

Mumbai-based investment bank Edelweiss Capital has divested 20% stake to a number of financial investors including the Government of Singapore Investment Corporation (GIC) and the New York-based hedge fund Galleon Partners for around $90 mn.

Edelweiss will announce the deal soon after the Foreign Investment Promotion Board (FIPB) clears the investments.

With this transaction, Edelweiss is valued at around $400-450 million. The investment bank is also considering an initial public offer (IPO) by 2008 to give an exit option to its various investor groups. Prior to deal, employees and promoters of Edelweiss were holding around 74% equity stake, with Greater Pacific Capital (GPC), a London-based strategic investment firm and Americorp Capital jointly holding the remaining 24% stake.

Edelweiss was established in 1996 and now boasts of a team of around 600 people, with services ranging from brokerage to investment banking, asset management and insurance advisory. Edelweiss has been growing at 100% growth rate over the last 3 years. Revenues grew to Rs. 147 crores in 2005-06, from Rs. 73 crores in the previous year, while PAT grew to Rs. 42 crores from Rs. 24 crores.

Read The Economic Times article.