Asia’s Private Equity News Source avcj.com November 15 2016 Volume 29 Number 43

EDITOR’S VIEWPOINT Governments’ support for fintech turns concrete Page 3

NEWS Ascendent, Blackstone, Carlyle, Future , GIC, HarbourVest, Hony, IFC, IMM, Macquarie, Movac, Northstar, ShoreVest, SoftBank, Warburg Pincus, Wattle Hill Page 4

DEAL OF THE WEEK IFMR bridges credit gap for Indian NBFCs Page 11

INCJ helps US cloud data start-up get global reach Page 11

Upstream unrest? AVCJ RESEARCH Private equity looks for value opportunities in Asia’s oil and gas sector Page 8 Data f ile Page 15

2016 AVCJ AWARDS PORTFOLIO

AVCJ award winners The exterminators Quadrant, PAG, Affinity, NewQuest honored Page 6 IVFA and Indian pest control player HiCare Page 12 Stretching our roots and reaching for the sky, SPRG grows along with you. Crowned “Asia Paci c Network of the Year” – Campaign Asia-Paci c PR Awards, “Asia Paci c Financial Consultancy of the Year” – The Holmes Report, “Public Relations Agency of the Year in Asia Paci c” – The Stevie® Awards, “Local Hero – PR Agency of the Year” – Marketing magazine, we know how to take you to a higher plane. EDITOR’S VIEWPOINT [email protected]

Managing Editor Stretching our roots and reaching for the sky, Tim Burroughs (852) 2158 9661 Associate Editor SPRG grows along with you. Head start Winnie Liu (852) 2158 9663 Crowned “Asia Paci c Network of the Year” – Campaign Asia-Paci c PR Awards, Staff Writer Holden Mann (852) 2158 9646 “Asia Paci c Financial Consultancy of the Year” – The Holmes Report, Justin Niessner (852) 2158 9678 “Public Relations Agency of the Year in Asia Paci c” – The Stevie® Awards, Design Edith Leung, Mansfield Hor “Local Hero – PR Agency of the Year” – Marketing magazine, Rana Tang we know how to take you to a higher plane. Events George Sengulovski, Jessie Chan, Jonathon Cohen, Sarah Doyle, Amelie Poon, Fiona Keung, FOR LATTICE80, SEE STONE & CHALK. THE week, Tharman Shanmugaratnam, chairman of Jovial Chung,

former is ’s recently launched co- the Montary Authority of Singapore (MAS) and Marketing working space, a 30,000 square feet facility close deputy prime minister, noted that “the Goliaths Agrina Sandri, Priscilla Chu, to the central business district; the work of local of the financial world have become more Yasna Mostofi investor Marvelstone Group, it has already signed nimble-footed, and are both competing with up 20 tenants exploring technologies ranging and partnering the Davids.” This remark implied Research Helen Lee, Herbert Yum, from blockchain to trading systems. The latter is that the corporate and start-up segments of the Kaho Mak, Tim Wong, ’s equivalent financial technology hub, industry can co-exist, but there was a sense from which launched last year. his broader statement that Singapore wants to Sales Both represent attempts by established do more to help the start-ups. Anil Nathani, financial centers to ensure a long-term future There are an estimated more than 300 Darryl Mag, Debbie Koo, Nathan Ho, Samuel Lau, in the face of intensifying disruption. Indeed, nascent fintech companies in the city state, while Gavin Lam, Pauline Chen the Sydney initiative in part arose from a global banks and insurance companies have government-backed report that warned the established local innovation labs and research Subscriptions city must act now to stay competitive because centers. To this end, the MAS is endeavoring to Jade Chan, Karina Ting Australian start-ups were already being make it easier for venture capital firms to back Sally Yip encouraged to relocate elsewhere. The financial these start-ups, with promises of shorter and Publishing Director sector accounts for 9% of ’s GDP, 18% of simpler registration processes and exemptions Allen Lee corporate tax receipts, and 420,000 jobs, most of from certain business conduct requirements. them in Sydney. Specific VC incentives will also be considered. Financial institutions in each market have However, arguably the most significant already moved to shore up their positions. contribution is Lattice80 itself. Not all co-working Headquarter Suite 1602-6 National Australia Bank established NAB Ventures space business models are successful – much Grand Millennium Plaza last year with a A$50 million ($36 million) rests on execution ability of the people on the 181 Queen’s Road captive fund to be invested in start-ups that ground in terms of providing mentorship and Central Hong Kong T. (852) 2158 9700 enhance its product offerings. Westpac Banking other value-added services. For fintech hubs F. (852) 2158 9701 Corp. and AMP entered the space even earlier, specifically, a key component is connections with E. [email protected] with Reinventure – the Westpac-backed unit the traditional financial services industry. URL. avcj.com

– launching its second A$50 million fund in For established financial services centers, Representative Office August. Superannuation funds are even playing a cultivating a fintech industry is essentially a No.1-2-(2)-B-A554, 1st Building, role, with First State Super agreeing a partnership question of talent management. They are home No.66 Nanshatan, with local fintech investor H2 Ventures. to plenty of skilled professionals and have much Chaoyang District, Beijing, People’s Republic of In Singapore, DBS is one of the most active to recommend themselves to others. But the key T. (86) 10 5869 6203 market participants, having set up a variety of is providing infrastructure and support to people F. (86) 10 5869 6205 programs on its own or in partnership with third – coming from academic institutions, other E. [email protected] parties. These include DBS HotSpot, a three- markets or the local industry itself – who are

month pre-accelerator program aimed at very pursuing opportunities outside of the established The Publisher reserves all rights herein. early stage start-ups. The bank offers a S$25,000 order. Reproduction in whole or in part is permitted only with the written consent of entrepreneur award, workspace and access to AVCJ Group Limited. ISSN 1817-1648 Copyright © 2016 industry mentors including angel investors and DBS executives. Candidates are not required to have an existing prototype or commit to giving Tim Burroughs A Mergermarket Group company up an equity stake to DBS. Managing Editor Speaking at official launch of Lattice80 last Asian Venture Capital Journal

Number 43 | Volume 29 | November 15 2016 | avcj.com 3 NEWS

Wattle Hill in first close on has raised a RMB200 million ($29 million) Series GLOBAL B round of funding led by Golden Brick Capital. Sino-Australian fund Nanfang Asset Management, Southern Media HarbourVest raises $4.8b Sydney-based GP Wattle Hill RHC Funds has Union Group and Haitong Securities also took achieved a $200 million first close on its debut part in the round through their investment units. for secondaries Sino-Australia cross-border fund. A final close on The firm has removed its variable interest entity HarbourVest Partners has reached a final close around $300 million is expected next year. LPs structure in preparation for an onshore listing. of $4.8 billion on its latest global secondaries include a European insurance company, a leading fund, beating the target of $3.6 billion. LPs in Chinese privately-owned insurer, and a family IFC plans investment in the fund include corporations, pension funds, office representing the founder of China’s largest endowments, foundations and high net worth direct e-commerce player. CompareAsiaGroup private sector investors across the globe. Wattle Hill, which also has offices in Hong The International Financial Corporation (IFC) has Kong and Beijing, was set up in late 2015 by proposed an investment of up to $25 million Albert Tse, who previously worked for Macquarie in Hong Kong-based financial comparison AUSTRALASIA platform CompareAsiaGroup. The capital will go towards marketing efforts, expansion of Movac reaches $74.5m first the firm’s marketing and product teams, and close on tech fund improvements to its technology platform. New Zealand venture capital firm Movac has Ascendent backs cancer achieved a first close on its fourth technology- focused fund with NZ$105 million ($74.5 million) diagnostics firm in commitments. The corpus comprises NZ$75 Ascendent Capital Partners has committed million from institutional investors including RMB50 million ($7.36 million) to BioChain Beijing, Ngai Tahu Holdings and New Zealand Venture a Chinese biotech company that focuses on Investment Fund, as well as local family offices, early detection of cancer. BioChain, which was community trusts and other private investors. Bank. His wife is Jessica Rudd, the daughter of founded in 1994, is a subsidiary of Team Curis former Australian Prime Minister Kevin Rudd. Group. The group develops new technology and Wattle Hill focuses on investments in Australian treatments that focus on cancer, with laboratories GREATER CHINA and New Zealand companies with a view to in California and China. helping them access the Chinese market. Hony invests $121m in oil “There are many China-US cross-border funds. But there are few that specialize in China and NORTH ASIA player Santos Australia, and have a deep understanding of Hony Capital has re-upped in Australia-listed both markets,” Tse told AVCJ. “Given China now Macquarie invests $10m in oil and gas supplier Santos for A$159.2 million is the second-largest economy in the world, ($120.8 million). It bought 40 million shares, many Australian companies are very keen to tap Yello Mobile representing 2.25% of the company’s total issued Chinese growth.” Korean mobile internet platform Yello Mobile capital, at A$3.98 apiece. The PE firm now holds a Wattle Hill’s four core team members are has issued $10 million in convertible bonds to 3.2% interest in Santos. ex-Macquarie employees with backgrounds in Macquarie Capital. The investment values the investment and cross-border M&A deals. Tse business at approximately $4 billion. Yello Mobile Ex-Shoreline executives worked for Macquarie in China between 2009 said the commitment takes its total funding - and 2014, assisting a handful of Chinese state- across the parent company and its subsidiaries reform as ShoreVest owned enterprises (SOEs) achieve offshore IPOs. - to KRW350 billion ($300 million), including ShoreVest Capital Partners is bidding on its first The fund will target consumer goods KRW60 billion in the second half of 2016 alone. Chinese non-performing loan portfolios since the manufacturers and service providers through core team members departed Shoreline Capital. minority or majority investments, committing up Japan’s Monstar Lab gets These will be financed using capital sourced to $50 million per transaction. Chinese companies from a global asset manager. ShoreVest is led by will also come into deals as co-investors. $2.4m round Benjamin Fanger, who co-founded Shoreline with Monstar Lab, a Japan-based company Xiaolin Zhang in 2004. Zhang continues to serve specializing in global outsourcing services for as managing partner of Shorelinet. RMB17.57 apiece in its offering. Investors Lilly Asia IT companies, has raised JPY250 million ($2.4 Ventures, Shenzhen Cowin Capital and China million) from investors including Resona Capital. Betta Pharma completes Everbright’s Medical & Healthcare Fund sold no Gogin Capital, an investment arm of locally based $106m IPO shares in the offering. San-in Gogo Bank, also participated in the round. Chinese drug developer Betta Pharmaceuticals Online learning site Future Venture Capital has completed a RMB720 million ($106 million) IPO on Shenzhen’s Growth Enterprise Market Smartstudy raises $29m expands into US Board. The company issued 41 million shares at Smartstudy.com, a Chinese online learning site, Tokyo-listed Future Venture Capital (FVC) has

4 avcj.com | November 15 2016 | Volume 29 | Number 43 NEWS

entered the US market, establishing a presence IMM joins consortium for based ride-hailing app Ola and its e-commerce in Fort Collins, Colorado. The firm acquired counterpart Snapdeal. The company’s earnings local professional services provider EnConnect $2.1b Woori Bank deal report for the six months ended September Holdings, which will retain its legal name but will IMM Private Equity is one of seven investors includes a loss of JPY58.1 billion ($550.7 million) also do business as FVC Americas (FVCA). that have acquired a combined 29.7% stake in as a result of changes in the fair value of preferred Woori Bank, a Korean lender that has been under stock in companies such as Ola and Snapdeal. A government control since 2001, for KRW2.4 JPY29.6 billion portion of this loss was attributed SOUTH ASIA trillion ($2.1 billion). IMM will take a 6% interest in to appreciation in the yen. the bank. The other successful bidders are Tong Warburg Pincus invests Yang Life, Mirae Asset Management, Eugene Asset Management, Kiwoom Securities, Korea SOUTHEAST ASIA $75m in Rivigo Investment & Securities, and Hanwha Life. Warburg Pincus has invested $75 million for a The sale process for Woori Bank was launched Blackstone pulls out of minority stake in Indian trucking company Rivigo. in July of last year, after various other attempts The transaction marks the GP’s third logistics deal to offload all or part of the government’s 51.04% energy platform in the country in the past two years. The capital stake failed. The most recent of these fell through The Blackstone Group has terminated an $800 is expected to scale up service offerings across in December 2014 because only one group bid million commitment to develop oil and gas India and accelerate development of technology assets in Southeast Asia with Malaysia-based and talent. Tamarind Energy. The decision was made in August as a result of difficulty securing attractive GIC invests $50m in India’s deals in the region. It is understood that none of the agreed capital commitment has been Capital First deployed. Singapore GIC Private has invested INR3.4 billion ($50.3 million) in Capital Warburg Pincus supports First, an Indian non-banking financial company (NBFC) backed by Warburg Pincus. The purchase ARA take-private will give GIC an interest of about 4.9%. Warburg Warburg Pincus has joined a consortium Pincus will continue to hold a majority stake in of investors including China’s Avic Trust to the business following the investment. for the 30% controlling interest put on the block, privatize Singapore-listed real estate fund alongside several smaller stakes. The FSC wanted management company ARA Asset Management Centrum launches $75m PE to sell a 30-40% stake in blocks of up to 10% each. in a deal worth S$1.8 billion ($1.3 billion). Woori Bank is the flagship asset of Woori Other consortium members include existing fund Finance Holdings, in which Korea Deposit shareholders The Straits Trading Company, India-listed financial services company Centrum Insurance Corp. (KDIC) held a 57% interest. KDIC Cheung Kong Property and JL Investment Group, has launched an INR5 billion ($75.3 million) created Woori in 2001 as part of a government- an entity owned by ARA co-founder John Lim. private equity fund to focus on domestic mandated consolidation of the banking sector. A consumer-focused industries. The vehicle, known total of KRW12.8 trillion was plowed into Woori. Northstar backs Southeast as Kalpavriksh, will invest in mid-sized, unlisted KDIC ownership was intended as a temporary companies with a focus on the financial services, solution to help a sector struggling in the Asian bedbank education, healthcare and fast-moving consumer aftermath of the Asian financial crisis. Northstar Group has taken what is understood to goods sectors. Woori Finance went public and KDIC trimmed be a minority stake in MG Group – a Southeast its holding through several block trades. After Asian “bedbank” that supplies hotel rooms to PNB Housing Finance gains initial attempts at an exit floundered because the travel agents, wholesalers, aggregators and tour government sought to sell all the Woori assets in operators. The company’s core business is MG on debut one go, the auction was divided into three parts, Bedbank, which is used by retail travel agents PNB Housing Finance, the mortgage lender the last of which involved Woori Bank. through a B2B booking platform and hundreds of subsidiary of India’s state-run Punjab National XML interfaces. Bank that is backed by The Carlyle Group, closed up 11.35% on its trading debut following a INR30 in funding from the PE arm of Reliance Group. MC Payment gets $3.5m for billion ($449 million) IPO. The company sold 38.7 Founded in 2013, the company claims to have million shares at INR775 apiece, with neither facilitated real estate investments worth more SE Asia expansion of the two existing shareholders - Carlyle and than $800 million globally, targeting the multi- Singapore private equity firm 2W Group has Punjab National Bank - making exits. residential and commercial property segments. led a $5 million ($3.5 million) funding round for domestic financial technology company MC Reliance PE backs real SoftBank marks down Ola, Payment. The investment included participation by Aura Funds Management, Tryb Capital and estate start-up Snapdeal Perle Ventures. It coincides closely with the Square Yards, an online listings service dedicated SoftBank has marked down the value of part of company’s establishment of new offices in to the property sector, has received $12 million its investment portfolio, including holdings India- Thailand and Indonesia.

Number 43 | Volume 29 | November 15 2016 | avcj.com 5 ASIA AWARDS [email protected] Two wins each for Quadrant, PAG, Affinity at AVCJ Awards 16th AVCJ Awards: Quadrant named firm of the year; PAG gets deal and fundraise prizes; Affinity, Navis triumph in exit categories; GGV, Sequoia India among the VC winners; NewQuest claims operational value add award

QUADRANT PRIVATE EQUITY and PAG Asia Capital secured two wins apiece at the 2016 AVCJ Private Equity & Venture Capital Awards, with the former taking the firm of the year and mid-cap fundraise prizes, while the latter was recognized in the deal of the year and large-cap fundraise categories. Affinity Equity Partners also received two awards – one for large cap exit of the year and the other a special achievement award for K.Y. Tang, the firm’s chairman and managing partner, in acknowledgment of his contribution to the industry. A total of 15 prizes were presented, with GGV Capital, The Longreach Group, Navis Capital Partners, Sequoia Capital, FountainVest Partners and NewQuest Capital Partners among the other winners. Chris Hadley, Quadrant’s executive chairman, paid tribute to his team and to the LPs that have backed the firm over the years, but also acknowledged the role played by the portfolio company management teams. “We have done 60 deals over 20 years, and some of those guys are exceptional people,” he said.” The awards recognized activity for the 12 months ended September 23, 2016. During this period, Quadrant closed its eighth Australia and New Zealand-focused fund at A$980 million ($754 million) after less than six weeks in the market. The firm followed up with completion of the sale of Canberra Data Centers, delivering a 3.4x multiple, and a string of new investments. PAG has also been proficient in fundraising, investment and exits, achieving a first and final close of $3.6 billion on its second pan-Asia buyout fund, deploying more than $2 billion in new deals, and securing partial exits from Chinese Music Corporation and Universal Studios Japan. The acquisition of Golden Apple Education Group – which won the deal of the year prize – was a particular coup as the first sizeable foreign private equity-led buyout cum debt restructuring in China. Technical skill was a common theme among the Chinese investments recognized at the awards. NewQuest won the operational value add category for the challenging turnaround of China Hydroelectric. Similarly, the IPO Quadrant Private Equity’s Chris Hadley of the year honor went to Focus Media, which blaze a trail that others have tried to follow with a reverse merger accepts the Firm of the Year award in Shenzhen. The business has appreciated in value more than three-and-a-half fold since going public. “Exits are a big challenge in Asia and it takes a lot of hard work and occasionally some good luck. We never thought this deal would come back to China for listing – we thought it would be Hong Kong – but we went through a complicated process and managed to list in China,” said Frank Tang, CEO of FountainVest, one of six GPs involved in the deal. Tang was also named PE professional of the year in recognition of a 12-month period in which FountainVest closed its third fund at $2.1 billion and secured several liquidity events. For Affinity, the awards were an opportunity to look back on recent successes – it won the large-cap exit prize for Loen Entertainment – and Tang’s overall track record in Asia, which covers more than 15 years. Recalling the comments he made when accepting an AVCJ Award 11 years ago, Tang observed there are four key elements to success in PE: be hungry, be passionate, be insightful, and don’t forget the fundamentals. He also stressed that PE investors are fortunate in that they have long-term funding and the ability to manage businesses in a sustainable way. “One of my LPs, who previously worked as a GP, said his managing partner always said the most important thing is to take care of investors. Number two is take care of your investments; and number three is take care of yourself,” Tang added.

6 avcj.com | November 15 2016 | Volume 29 | Number 43 ASIA AWARDS [email protected]

K.Y, Tang of Affinity Equity Partners (right) receives the AVCJ Special Achievement award from Allen Lee, publshing director of AVCJ

ROLL OF HONOR

Fundraising of the Year – Venture Capital: GGV Capital VI, GGV Discovery I & GGV Capital VI Entrepreneurs Fund (GGV Capital) Fundraising of the Year – Mid Cap: Quadrant Private Equity No.5 (Quadrant Private Equity) Fundraising of the Year – Large Cap: PAG Asia II (PAG Asia Capital) Deal of the Year – Early Stage Technology: Zai Lab (Advantech Capital / OrbiMed/Qiming Venture Partners/Sequoia Capital/TF Capital) Deal of the Year – Late Stage Technology: Go-Jek (KKR/Warburg Pincus/ Capital Group International/Farallon Capital) Deal of the Year – Mid Cap: Wendy’s Japan (The Longreach Group) Deal of the Year – Large Cap: Golden Apple Education Group (PAG Asia Capital) Exit of the Year – IPO: Focus Media (FountainVest Partners/The Carlyle Group/CITIC Capital/Primavera Capital/Fosun Group/China Everbright) Exit of the Year – Mid Cap: Golden Foods Siam (Navis Capital Partners) Exit of the Year – Large Cap: Loen Entertainment (Affinity Equity Partners) Venture Capital Professional of the Year: Shailendra Singh (Sequoia Capital India) Private Equity Professional of the Year: Frank Tang (FountainVest Partners) Steven Tran of Hogan Lovells (left) presents the PE Professional of Operational Value Add: China Hydroelectric (NewQuest Capital the Year award to FountainVest Partners’ Frank Tang Partners) Firm of the Year: Quadrant Private Equity AVCJ Special Achievement: Kok-Yew Tang (Affinity Equity Partners)

Number 43 | Volume 29 | November 15 2016 | avcj.com 7 COVER STORY [email protected] Under the pump Although a low oil price environment has created interesting inroads for PE investors seeking exposure to Asia’s growing energy consumption story, challenges of timing and targeting have slowed uptake

THE RECENT ACTIONS OF TWO US-BASED “When capital expenditure and costs are that multinationals with restricted budgets are PE firms, The Blackstone Group and Simmons being monitored very closely, making production providing an opening to alternative buyers by Private Equity, say much about the evolving from a late-life reservoir more efficient is an area declining to take a chance on even the most investment opportunity for Asian oil and gas where you want to be,” says Jeff Corray, managing attractive of cash-strapped juniors. The reduced in a low commodity price environment. The director and head of private equity at Simmons. M&A competition is further exaggerated in Asia former pulled out of an $800 million project “Asia and Southeast Asia are very much in our line Pacific, where only about 5% of global upstream development effort in Malaysia due to difficulty of sight and Leap covers some of the provinces M&A activity is transacted, many NOCs have sourcing deals in the region, while the latter that we were focused on for this platform. It’s been conspicuously quiet in recent months, and quietly scored an acquisition in the same country, challenging when activity is lower, but there’s a some international corporates are reducing their but one that is geared more toward operational lot of opportunity here, and it’s a good market regional footprints for budgetary reasons. efficiency than expanding output. ultimately for us to do business in.” “There has been a lot more capital from The Blackstone plan, launched in mid-2014 buyers in Asia traditionally which has meant before the oil price plunge, was focused on Up and down attractive deal flow has been a bit slower to growing an asset base in Southeast Asia through For the past two years, the global energy industry emerge and there’s been a bit of a lag in deal Tamarind Energy, an entity created by former has been defined by the rapid fall in oil prices pricing. But you’re now starting to see attractive executives at Canada’s Talisman Energy. The in late-2014. This saw the commodity tumble deals across Australasia and Southeast Asia, move envisioned partnerships with national oil from a relatively steady $100-per-barrel valuation so we’re increasing the focus there,” says Jason companies (NOC) that would leverage Talisman’s to a range around the $50 mark; it scraped as Cheng, managing partner at Kerogen Capital. expertise in maximizing production as energy low as $30 a barrel earlier this year. No one saw “National oil companies in Asia still need to demand in the region grew in step with a the drop-off coming, although hindsight has acquire assets in order to feed the growth engine. number of socioeconomic trends. Blackstone allowed analysts to paint what should have The long-run underlying dynamics haven’t retreated in August, however, without making been a predictable technology-driven curve. changed for Asian energy security, so we expect any investments. This narrative essentially tracks how Middle buyers to be back in the market in the not-too distant future.” In a survey conducted by Mergermarket of “If you buy into a portfolio of oil and gas 100 private equity professionals active in the oil and gas sector over the past two years, all 100 concessions at the wrong time in the cycle, you’re responded that they expected the level of PE interest to increase in Asia Pacific. This compared not buying a group of assets – you’re buying a to 99% and 67% showings for North America and collection of liabilities” – Mark Thornton Europe, respectively. It is difficult to argue with the sturdy fundamentals that support this outlook: Asia’s While the Simmons deal follows a comparable East export restrictions artificially inflated oil low level of energy output versus its increasing premise related to supporting existing producers, prices, encouraging alternative North American consumption levels. However, the apparent PE the focus is on helping control costs than closing energy plays to redraw global crude trade openings related to lower competition and a the region’s demand-supply gap. Specifically, flows by perfecting unconventional production general lack of liquidity are also symptoms of the the firm paid an undisclosed sum for subsurface techniques that would have otherwise been region’s inherent disadvantages. These include a consulting company Leap Energy with plans to uneconomic. lack of specialized talent and lingering difficulties grow a portfolio of complementary upstream The result has been an energy glut that in realizing favorable partnership terms with advisors. has seen oil, gas, coal and uranium prices each NOCs, which can oblige investors to maintain This traction suggests that weak oil prices are hit lows that have proven crippling for many spending on projects throughout the downturn. creating opportunities for investors to work with operators. In the upstream oil and gas space, “If you buy into a portfolio of oil and gas NOCs and locally established supermajors that development expenditure cutbacks created by concessions at the wrong time in the cycle, you’re need to address cost pressures. At the same time, this environment suggest that private equity not buying a group of assets – you’re buying the contrast of Blackstone’s setback amounts could benefit from a number of opportunities for a collection of liabilities because you have to to a warning about the challenges related to building up underinvested fields. keep funding the appraisal and development the long-term nature of the industry and the GPs are therefore calling this end of the oil commitments,” says Mark Thornton, managing importance of an approach finely targeted on price cycle a buyers’ market for long-horizon director of Indonesia Private Equity Consultants. the needs of entrenched regional players. investors. The view is reinforced by the notion “That can keep private equity investors on the

8 avcj.com | November 15 2016 | Volume 29 | Number 43 COVER STORY [email protected]

sidelines until they’re sure the oil price is starting clearer focus. Indeed, the firm’s latest acquisition based not only on the considerable contract to turn up again. For it to go back up to around was planned as the first step in forming a global values involved but also on the discipline’s ability $60 a barrel – that is where a lot of these projects consulting group that would bundle together to create relationships with new clients as one of start to look attractive in terms of upside potential niche service providers able to realize essential the first areas of focus in project development. – that still feels to be a few months away.” operational optimizations for oil and gas Complex drilling and geo-mechanics, meanwhile, companies experiencing commodity price- represent potentially viable investment targets Services angle related stresses. since they offer a chance to leverage growth in As many long-term expectations for the oil In the case of Leap Energy, which maintains the unconventional production methods used in price to remain in a $45-50 per barrel range offices in Malaysia, Indonesia, Australia and late-life fields as companies scale back spending have hardened, the primary deal flow driver Europe, this chance to expand internationally on the development of new reservoirs. has reverted from absolute distress to a more while keeping its core leadership intact strategic portfolio rationalization process. presented a compelling alternative to being Be patient, very patient As such, the corporate carve-ups that had absorbed by an industry conglomerate. The deal PE investors are also seeing project acquisition been envisioned as creating asset fire-sale could be seen to exemplify the advantage private advantages as a result of low oil prices opportunities in the region did not gain much equity investors have over corporate competitors weakening the services market. As overall operational activity pulls back and equipment utilization rates decline, doors are opening to What do PE proessionals in oil and gas epect to happen to the level o PE develop projects with lower breakeven financial interest in maor global regions thresholds. Taking advantage of the effect of lower cost bases, however, remains a matter of Asia Paci c timing. North America “You need to find projects where you can

Africa maximize the impact of cost deflation in the near term, because once rigs are stacked and capacity Europe is taken out of the market, subsector pricing will Latin America recover and increase,” Kerogen’s Cheng explains. Middle East “So your window to lock in cost deflation opportunities may only be a couple of years.” 0 20 40 60 80 100 This window of opportunity reflects an Percentage o respondents industry consensus that a timeframe of about Increase Decrease Remain the same two years will be required for supply-demand

Source: Mergermarket stabilization and attractive exiting conditions to return. However, in the context of the longest oil price recession yet, this projection has come traction in 2015. Investors as a result seem wary where ambitious juniors are seeking inorganic as cold comfort to many PE players. “LPs have to commit to the sector, with Wood Mackenzie growth in a downturn. been telling me they have no appetite for estimating the total value of Asia Pacific M&A “We were approached a number of times in highly cyclical plays like oil and gas,” says one PE activity in oil and gas as having declined 64% the past by other parties, but it was the specific professional. “No one seems to want to go near it during 2015 to $5.4 billion. expertise in the oil and gas sector brought to the on the listed side or the private side.” “Although the bid-ask spread has slowly table by Simmons, who have successfully taken The universal hesitancy that this feedback narrowed, we have not seen sufficient distress to consultancies to the next level, that attracted implies offers a reminder of the sentiment-driven date to drive a buyers’ market,” Wood Mackenzie us to them,” says Arnout Everts, Leap Energy’s nature of the energy industry. In many respects, oil and gas researchers Angus Rodger and technical director. “We were comfortable with the the cyclicality plays into PE’s ability to ride out Ashima Taneja told AVCJ, adding that Asia business model we had, but we recognized there long turnaround periods with patient capital. But Pacific M&A activity for the current year had only were limits to where we could take it without an at the same time, it confirms that uncertainty reached $4.2 billion in value so far. “That said, investor behind us. We started thinking about about the timing of the cycle can be a game- we expect more deal flow over the next few laying the foundation for another growth jump changer for would-be partners, especially in light months as the majors across Asia Pacific look as and when things pick up, and that’s when of industry expectations that 2017 will be the to offload more mature and non-core assets to Simmons knocked on our door.” third consecutive year of capital expenditure cuts ease pressures on balance sheets and aid global The strategy includes a focus on due to overall market weakness. divestment targets.” diversification in technical specializations as “It’s going to take longer to come out of As this scenario of slowly increasing but well as geographic footprint. Leap offered this recession, so we need run the businesses still carefully controlled deal flow unfolds, Simmons additional knowhow in mature field as though they will always operate in this GPs may have to contend with higher pricing production optimization and predictive analytics environment,” Simmons’ Corray adds. “We aim than expected and extend considerably more for conventional and unconventional reservoirs. to buy and grow as aggressively as we can, but than as part of their value-add In return, the PE was able to interest Leap with we are quite conservative in our assessment of proposition. In this context, Simmons’ strategy an opportunity to push further into the fields of the outlook for the next couple of years. We’re of offering tailored solutions to a company in geophysics, geo-mechanics and complex drilling. not in the short game – we are building proper need rather than simply attempting to exploit The rationale behind an emphasis on businesses to be able to sell when the time is the macro imbalances of the sector comes into geophysics ¬– including seismic processing – is right.”

Number 43 | Volume 29 | November 15 2016 | avcj.com 9 Asian Venture Capital Journal avcj.com site licences

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How much does it cost That depends on how much access you want, but we can customise cost-e ective packages to all rms, regardless of size. For more information, contact Sally Yip at +(852) 2158 9658 or email [email protected] and we will be happy to discuss with you. Asian Venture Capital Journal DEAL OF THE WEEK [email protected] / [email protected] avcj.com site licences Eight Roads bets on IFMR as a credit hub

NON-BANKING FINANCIAL COMPANIES IFMR aims to address a paradox in India’s medium-sized enterprise] finance, with a (NBFCs) are a hot ticket in India. Policymakers and NBFC market: the institutions that are most useful diversified risk profile across multiple companies,” investors alike are eager to back groups that offer in the economy – targeting highly specialized or says Narang. “IFMR participates in the debt financial services with greater geographical reach new sectors – have the hardest time obtaining raising process as a knowledge partner and as a and efficiency than traditional banks. While these credit. While IFMR is also often unfamiliar with co-investor.” companies can be a boon for populations that an NBFC’s particular sector focus, it does have a IFMR’s reputation for sound investment have struggled to obtain credit, they often have deep knowledge base of the NBFC industry in decisions is also known among other market difficulty obtaining financing themselves from general and with end borrower players, which means it is a lenders that may not understand what they do. behavior across the country. useful barometer to judge the IFMR Capital is a potential solution to this Eight Roads was impressed worthiness of a particular NBFC. problem, providing credit to NBFCs and helping with the company’s ability to While Eight Roads has made increase their profile in the financial sector. Eight maintain a high quality loan few investments in the financial Roads Ventures India, which recently invested portfolio encompassing a services space so far, it expects $25 million in IFMR, sees the company as the range of sectors, along with more as it becomes better backbone that India’s financial services sector its willingness to lend its own acquainted with the industry. The needs in order to support growing but still money rather than serving as NBFCs: Credit for the lenders firm believes IFMR can offer more vulnerable institutions. a middleman like some other insights due to its dealings with “Our thesis was based on a combination of financial services companies. The GP sees IFMR other NBFCs and financial institutions and help it a macro play on the financial services sector as a way to obtain exposure to these promising spot new trends and promising players. Wider reach to everyone in your organisation along with the company’s differentiated economic areas for itself. “Financial services is a large, attractive and positioning, strong credit processes, high “Our investment in IFMR is a play on multiple growing sector,” says Narang. “We have been quality management team and track record fast-growing financial services sub-sectors keen to invest in this segment and continue to of execution,” says Kabir Narang, partner and including affordable housing finance, vehicle evaluate opportunities in financial services and avcj.com site licence allows everyone in your organisation to have instant access to in-depth analysis, managing director at Eight Roads. finance, microfinance and SME [small and fintech.” real-time news and information on private equity in Asia and beyond. Sign up or an avccom site licence now and empower your team with critical inormation and data to soar above your competitors in Asian private euity: Treasure Data helps businesses reach the cloud Access up-to-date news on Asia’s private equity market Track the latest trends in fund raising, investments, exits and capital under management WHEN INNOVATION NETWORK Founded in 2011 as interest in big data recognized the global expansion potential of Learn of new mergers, acquisitions and business alliances Corporation of Japan (INCJ) committed $10 started to grow, Treasure Data develops cloud- this business model after a string of successes million to Treasure Data, it represented a show based platforms that are used in the analytical with major clients, including Tokyo-based digital Undertake investment and risk assessment of faith in the future of commercial big data processing of log data from web, mobile, and entertainment products specialist Pioneer. Assess the e ects of global developments on a specic region or country that was strong enough to lure the investor other sources. It had 200 clients as of September. While Treasure Data has worked with outside of its domestic stomping ground. The “We noticed a proliferation of several of Japan’s Fortune 500 Understand changes in the regulatory environment US-headquartered company was founded by highly advanced technology to companies, including Subaru, Get business intelligence on major deals Japanese entrepreneurs and maintains offices in handle petabytes and exabytes the heart of its value proposition Tokyo and Korea – but offered a rare inroad to of data, but in reality, people has always been simplifying data Swiftly and accurately identify potential business opportunities the sometimes impenetrable talent pool of large- struggled to make these pieces management for the operators scale analytics. of technology work together, and that need it most – the small to “For them to think outside of their comfort it required a lot of technical talent medium-sized enterprises that How does it work zone is humbling,” says Kiyoto Tamura, vice which outside of Silicon Valley can’t afford to tinker with an president of marketing at Treasure Data. “I think is few and far between,” Tamura Big data: Organizing knowhow unmarketable gimmick. We will arrange online access for your employees to avcj.com, either with individual passwords or by general of it as a reflection of their confidence in our says. “We asked internally how “Unlike the previous ability to build up not just in Japan, but beyond.” we can enable businesses that are not Facebook, generation of customer experience access through IP address recognition. INCJ’s investment contributed to a $25 million Amazon or Google to leverage their own data to management, this is not just about having a Series C round alongside SBI and several existing leverage their own data to deliver a much better system as a record of who the customers are, but backers – Sierra Ventures, Scale Venture Partners, customer experience.” being able to combine data coming from many How much does it cost AME Cloud Ventures, IT-Farm, Dentsu Digital This service is offered through a focus on a sources,” adds Tamura. “Phase one of the big data Investment, and Bill Tai. The company previously well-packaged, end-to-end cloud data platform revolution was just getting all the technology out That depends on how much access you want, but we can customise cost-e ective packages to all rms, received $15 million in Series B funding led by that uses customer data to help company there, but now we’re maturing and making sure Scale in January 2015. Total funding to date decision makers make the right strategic calls. it’s not just an experiment and that it will deliver regardless of size. For more information, contact Sally Yip at +(852) 2158 9658 or email [email protected] and amounts to $54 million. INCJ, with an eye on the Japanese market, tangible business results.” we will be happy to discuss with you.

Number 43 | Volume 29 | November 15 2016 | avcj.com 11 PORTFOLIO [email protected] Leaders of the swarm IVFA bought HiCare with an eye to cornering India’s nascent pest control market, but the firm’s ambitions for the company are much greater

WHEN INDIA VALUE FUND ADVISORS of Godrej Consumer Products. In its original pest control space, IVFA saw HiCare as a hidden (IVFA) looked at India’s pest control market in incarnation Mahendran intended HiCare to opportunity. The firm believed the growth of 2014, the industry offered little to recommend operate alongside the company’s insecticide India’s middle class would boost interest in itself at first glance. Low interest levels, business and provide insect control services to hygiene issues and pest control as consumers particularly on the consumer side, meant that residential and business customers. sought to emulate Western lifestyles. Once the space was dominated by small businesses, However, that business model morphed that occurred, having one of the few organized mainly operating on a local scale, with few upon HiCare’s acquisition by Danish facility players in the industry would be a major benefit. organized players to appeal to consumers. management company ISS Global in 2009. Like “Our own understanding of the growth of the But the market’s sluggishness was precisely Godrej, ISS saw HiCare’s services as a useful market is that it has been more of a supply-side where the firm saw opportunity. When A. adjunct to its core business, and offered pest challenge than a demand-side challenge,” says Mahendran, a former executive at the Godrej control as an add-on to the customers who Himanshu Chakrawarti, who joined HiCare as conglomerate, asked IVFA to partner with him purchased its management service. But this CEO in 2015. “We feel that in this market, supply on buying its onetime insect control services focus on enterprises came at the expense of the will create the demand if you have good-quality division, it needed little prodding. company’s potential success among consumers. service providers.” “What we realized was that there is extremely low penetration for these kind of services in India, Recruitment issues and with urbanization increasing the problems “We haven’t had to sell One of the first challenges facing the new owners related to pests are only going to increase,” recalls was to beef up the company’s management Ashish Bargava, a partner at IVFA. “Also, as per to them on why or how team. As a division within larger conglomerates, capita income goes up we are likely to see more we need to do this. there had been no need for HiCare to build up a and more people become more hygiene-aware, complete corporate structure of its own. While and therefore the need for such services is going In fact they’ve been a a competent staff of technicians was already to increase.” in place, many departments such as human Now two years into its investment, the private great help along the resources and payroll had not been established. equity firm continues to see pest control’s “On the residential side, the business way” – Himanshu Chakrawarti growth theme as a winning bet. However, it had grown very little over the last four years is also setting the company’s sights higher by before the acquisition,” Chakrawarti says. “Even expanding into new verticals and attempting “Their core business was really facility the team that was there already was almost to build a more diverse brand identity among management, and the B2B [business to business] entirely operational in nature. So one of the key consumers. As India’s middle class continues pest control kind of fit into that business, so there challenges they had was to create a set of highly to grow, HiCare’s owners hope to take a major was a natural tendency to focus on the B2B part,” talented people which would drive and fuel a chunk of this burgeoning customer base. says Bhargava. “It’s not that they ignored the B2C much larger independent business over a period [business to consumer] side of things, but there of time.” Pest problems was less emphasis on it.” Adding Chakrawarti to the team satisfied one Pest control would seem like a natural fit for India, Under ISS, HiCare did a brisk trade servicing of the new owners’ key concerns, since finding a tropical country long infamous for its swarms of the parent company’s corporate clients. Its a head for the newly carved out company had mosquitoes, flies and other animal annoyances. consumer side, on the other hand, saw little presented a considerable challenge. IVFA and But in 2014 the country’s extermination and development. HiCare continued to serve its Mahendran had few options within India’s still pest prevention industry had so far shown few existing residential customers, but ISS made little largely undeveloped pest control space, and signs of growth, particularly on the consumer investment in marketing and brand building to executives from the existing, underperforming side, where most of the revenue came through acquire new ones. players in the market held little appeal. products such as traps and sprays, rather than At this point Mahendran, who had left Godrej Eventually the owners decided that a CEO services – more than three times as much. This before HiCare’s sale to ISS, re-entered the picture. unencumbered by experience in pest control distribution was the opposite of that found in He approached IVFA proposing to partner with might actually be able to pursue a bolder Western countries, where services account for them to buy the business back from ISS, which course than a veteran of the weak performers. five times the revenue of products. was looking to divest its non-core assets. The Discussing their ideal candidate, they decided HiCare had pursued this market in a firm agreed, and the two pursued a deal that on some essential qualities for the new head: haphazard way when IVFA first encountered it. ultimately saw HiCare change hands for INR2.5 he should have considerable experience in The company was founded in 2003 as part of billion ($39.7 million), with IVFA taking an 80% retail, in order to help build out the residential the Godrej conglomerate under the auspices of stake and Mahendran holding the rest. service business; he should have experience in Mahendran, who was then managing director Despite the historically sleepy nature of India’s a high-growth industry; and he should have a

12 avcj.com | November 15 2016 | Volume 29 | Number 43 PORTFOLIO [email protected]

good understanding of technology, in order to based on the convenience of both parties, and Big ambitions implement the efficiency measures that they comes to your home to deliver the service,” says While all of these initiatives are helpful for were planning to introduce. Bhargava. “It’s a multi-step process, and because HiCare’s core pest control business, their real Chakrawarti met both of these requirements. it’s a multi-step process, the access friction is purpose is to lay the groundwork for a much He had 10 years of retail experience, first as the extremely high.” more ambitious goal. IVFA plans to transform the COO of the Landmark Limited department store Rather than stick with this model, HiCare company into a broader home hygiene solution chain and then as CEO of The Mobile Store, India’s wished to transition to an on-demand system, that can offer customers a range of services, from largest mobile phone retailer. The second of whereby customers can make appointments house cleaning to air purification. these also helped him meet the high-growth and with service providers through a single The jump from pest control to house cleaning technology industry qualifications. nationwide platform via the web or a mobile may seem incongruous, but HiCare and IVFA feel “We thought retail was probably the closest app. The request is then sent to a computerized that the step is not only logical, but inspired. With business to something like this, because it is routing system that assigns the task to an a booking and routing system already in place, distributed, it has huge manpower requirements, available technician in the customer’s area, and adding more services is only a matter of tweaking and it caters to consumers, so there was a plans out the technician’s rounds for greatest the existing infrastructure. In addition, HiCare’s consumer orientation that was important,” says efficiency. existing customer base has already demonstrated Bhargava. “It has a big service element, so the The goal is to replace as many of the fallible an interest in cleanliness and a willingness to pay CEO needed to understand the service part.” human layers between customers and service an outside company to provide it. By becoming Another challenge for IVFA was finding providers with technology solutions that will a one-stop shop for multiple hygiene categories the right business model to rebuild HiCare’s hopefully be more precise. The company expects the company hopes to take a bigger part of its atrophied consumer arm. The firm was productivity to improve by as much as 25% when customers’ attention and build its reputation. determined to find cost savings and streamline its new systems have been fully pushed out to its “There was consumer tailwind that we felt the company as much as possible to make franchisees nationwide. toward this category, both in terms of increasing scaling the business easier and give it an HiCare has found IVFA a willing partner urbanization and higher per capita income, advantage over its competitors. in pushing these changes. The firm sees the which will get more and more people to buy One of the first steps was to move to a benefits of such technological enhancements as these kinds of services,” says Bhargava. “Therefore franchise model for expanding the business. At well worth the initial investment required. “We with the low penetration to date, one of the big the early stage of their ownership this removed haven’t had to sell them on why or how we need growth stories was that as penetration improves, some of the burden of day-to-day operations to do this. In fact they’ve been a great help along we are likely to corner greater share.” from the in-house staff. In the long term it will the way,” says Chakrawarti. “They themselves HiCare has pursued its expansion deliberately, help to keep the company asset-light and give want to be at the forefront of adding technology first researching the segments it was interested in and then slowly adding them to its service portfolio over the past 18 months. Currently it Indias pest control services market offers eight house cleaning services, with plans to add two more by the end of the year. It wants to add air purification in the near future, but is moving more slowly on this because of the higher level of training required. Unorganized Current Organized By F2020 IVFA hopes its new initiatives will help HiCare Hyperlocal/On demand become a force in the home hygiene industry. Before the acquisition the company had shown anemic growth, with a constant annual growth rate of 3% between 2011 and 2015. However, as Source: HiCare India’s consumers strive for higher standards of living, the firm expects business to take off, with a CAGR of 36% projected from 2015-2019. local operators more flexibility in how they run as a key enabler for their portfolio companies.” As HiCare grows into its own, IVFA will their franchises on the ground. There is a certain urgency to the company’s consider its exit options. Despite the positive The owners were also determined to push for change, due to expected future shifts in growth expectations, the company will remain introduce new technology solutions across the the industry. Currently the pest control services too small and niche for an IPO. A sale to another company that could both boost efficiency and industry, in addition to its small size, is dominated Indian service provider – or a multinational create a more engaging customer experience. by unorganized players – only 30% of the market looking to enter the country – is more likely. The IVFA was inspired by the changes wrought by is made up of organized companies like HiCare. GP believes the innovative technology solutions new communications technologies in India and The company expects the unorganized part of that it is putting in place will be the attractive other markets in industries such as taxis and the market to shrink to 55% by 2020. feature for a buyer when it does decide to sell, home services. It wanted to catapult HiCare However, the organized services slice is only even more than the size or market share. ahead of its competitors, which were mostly still slated to grow 5%. The remainder will be taken “We are aspiring to be number one in the tied to old-fashioned pencil and paper methods. by on-demand services, a category not currently area where we operate, but even if we are not “The way things work in pest control services represented. HiCare’s mandate is to grab as much number one, then we would definitely like to be is that you call up some operator, and he then of this as yet unrealized category that it can, in the most profitable tech-driven company,” says gives you a quote and schedules an appointment expectations of greater growth to come. Bhargava.

Number 43 | Volume 29 | November 15 2016 | avcj.com 13 18

Date: 18 January, 2017 (Wed) Time: 8:30 am - 5:30 pm followed by cocktail reception Venue: S421, Hong Kong Convention and Exhibition Centre (Old Wing), 1 Expo Drive, Wan Chai, Hong Kong

Opening Remarks Opening Keynote Luncheon Keynote Closing Keynote Tsang Chun-wah, John, GBM, JP David Wei Jean Salata Ming Lu Financial Secretary Chairman & Founding Partner Chief Executive & Founding Partner Head of Asia Private Equity HKSAR Government Vision Knight Capital Baring Private Equity Asia KKR

James Ahn Alice Au Varun Bery Mintoo Bhandari John Campbell Partner Global Head, Financial Managing Director & Co-founder Senior Partner Chairman & Co-founder Principle Capital Services Practice & Board of TVG Capital Partners Apollo Global Management Campbell Lutyens Director, Spencer Stuart Nicholas Cator Edwin Chan Kent Chen Lorna Chen Gordon Cho Executive Director Regional Head, Asia Managing Director Partner Head of Korea & Managing Verlinvest Asia Probitas Partners Neuberger Berman Shearman & Sterling Director The Rohatyn Group Junghyung Cho Liam Coppinger Tim Flower Richard Folsom Peter Fuhrman Partner Managing Director, Private Managing Director Representative Partner Chairman & CEO Excelsior Equity, Manulife Asset HarbourVest Partners Advantage Partners China First Capital Management Praneet Garg Kenneth Gaw Jie Gong Mounir Guen Amit Gupta Managing Director President & Managing Partner CEO Partner & Co-founder Asia Alternatives Principal Pantheon Ventures MVision Clearwater Capital Partners Gaw Capital Partners Yuka Hata Andrew Hawkyard Christopher Heady Jim Hildebrandt Archana Hingorani Chief Portfolio Manager Managing Director Chairman of Asia Pacific & Head Managing Director CEO & Executive Director Alternative & Fund Investment, of Real Estate Asia Bain Capital IL&FS Investment Managers Nissay Asset Management Corporation Blackstone Harry Hui Ryosuke Iinuma Josh Jacob Mohanjit Jolly John Kim Founder & Managing Partner Representative Director & Managing Director Partner Principal ClearVue Partners Managing Partner Hamilton Lane (Hong Kong) Iron Pillar AlpInvest Partners Ant Capital Partners Megumi Kiyozuka Charles Knight Alvin Lam Don Lam David Larsen Managing Director Global Director – M&A Senior Managing Director CEO & Founding Partner Managing Director (Head of Japan), Services CVC Capital Partners VinaCapital Duff & Phelps CLSA Capital Partners Japan Deloitte Jason Lee Kevin Lee Nisa Leung Bin Li Judith Li Managing Director & Head of Asia Real Managing Partner Managing Partner Partner Partner Estate Crescendo Equity Partners Qiming Ventures Ally Bridge Group Lilly Asia Ventures The Carlyle Group Kevin Loh Eric Mason Darren Massara Rodney Muse Girish Nadkarni Managing Director Managing Director - Asia Managing Partner Managing Partner Partner, Private Equity Creador Investments NewQuest Capital Partners Navis Capital Partners IDFC Alternatives The Church Brian O'Connor Mark O'Hare James Pearson Alexander Pestalozzi David Pierce Founding Partner Founder & Chief Executive CEO Managing Director Managing Director & Falcon House Partners Preqin Pacific Risk Advisors Mueller Asia Head of Asia HQ Capital Lachmi-Niwas Sadani Simon Sham David Shen Kunal Shroff Padmanabh Sinha Founder & Managing Partner, Managing Director Regional Managing Director Managing Partner Managing Partner Lensbridge Capital Darby Private Equity Olympus Capital Holdings Asia ChrysCapital Advisors Tata Opportunities Fund

Edward Sippel Bryan Southergill Yinglan Tan Ravi Thakran Jim Tsao Managing Director Managing Director, Venture Partner Group President, LVMH South & Chairman & Head of China TA Associates Asia Pacific Real Estate Sequoia Capital Southeast Asia and Middle East; Permira Advisers (China) KKR Chairman & Managing Partner, L Catterton Asia Denis Tse Pote Videt Joseph Wan Vivian Wan Frances Wang Managing Principal Managing Director Operating Partner Operating Director Director Asia-IO Advisor Lombard Cinven HK TPG Capital IDI Emerging Markets Partners

Dominik Woessner Kenneth Wong Reijiro Yamamoto Organiser: Co-organiser: Media Partner: Managing Director Partner Founding Partner Greenhill Cogent Primavera Capital Integral Corporation

Dongao Yan Tommy Yip Jianyi Zhu Free LP Passes for Pension Funds, , Endowments, Foundations, Senior Vice President Founding Partner Co-founder & Partner Family Offices, DFIs and Sovereign Wealth Funds. Register: [email protected] HQ Capital Unicorn Capital Partners ADV Partners Quote "AVCJHK2017_HKVCA" code to enjoy 20% off (non-member rate) of HKVCA represents the rights to amend any details due to unforeseen circumstances. a ticket for all AVCJ subscribers To register, please visit apef.hkvca.com.hk Tel: +852 2167 7518 Email: [email protected] 18 PRIVATE EQUITY DATA FILE | AVCJ RESEARCH [email protected]

Date: 18 January, 2017 (Wed) Time: 8:30 am - 5:30 pm followed by cocktail reception Venue: S421, Hong Kong Convention and Exhibition Centre (Old Wing), 1 Expo Drive, Wan Chai, Hong Kong PRIVATE EQUITY IN ASIA Investment Breakdown by Country From January to October 2016 Opening Remarks Opening Keynote Luncheon Keynote Closing Keynote Country Deal Amount ($mln) No. of Deals No. of Disclosed Deals No. of Investee China (PRC) $35,431.2 881 654 841 Tsang Chun-wah, John, GBM, JP David Wei Jean Salata Ming Lu Australia $32,770.6 77 52 77 Financial Secretary Chairman & Founding Partner Chief Executive & Founding Partner Head of Asia Private Equity HKSAR Government Vision Knight Capital Baring Private Equity Asia KKR India $8,740.8 522 376 506 $6,098.1 183 175 179 Japan $4,248.1 532 367 516 James Ahn Alice Au Varun Bery Mintoo Bhandari John Campbell Hong Kong $3,444.3 30 21 28 Partner Global Head, Financial Managing Director & Co-founder Senior Partner Chairman & Co-founder Singapore $3,419.0 68 49 65 Principle Capital Services Practice & Board of TVG Capital Partners Apollo Global Management Campbell Lutyens Director, Spencer Stuart Malaysia $1,421.4 37 27 37 Indonesia $1,359.6 55 28 55 Nicholas Cator Edwin Chan Kent Chen Lorna Chen Gordon Cho Executive Director Regional Head, Asia Managing Director Partner Head of Korea & Managing New Zealand $1,012.8 8 7 7 Verlinvest Asia Probitas Partners Neuberger Berman Shearman & Sterling Director Vietnam $698.1 24 14 24 The Rohatyn Group Philippines $390.2 19 6 19 Junghyung Cho Liam Coppinger Tim Flower Richard Folsom Peter Fuhrman Taiwan $263.3 9 8 9 Partner Managing Director, Private Managing Director Representative Partner Chairman & CEO Thailand $91.7 26 8 24 Excelsior Equity, Manulife Asset HarbourVest Partners Advantage Partners China First Capital Management Pakistan $2.1 3 1 3 Sri Lanka $2.1 6 1 6 Praneet Garg Kenneth Gaw Jie Gong Mounir Guen Amit Gupta Bangladesh $2.0 1 1 1 Managing Director President & Managing Partner CEO Partner & Co-founder Asia Alternatives Principal Pantheon Ventures MVision Clearwater Capital Partners Myanmar (Burma) $1.5 4 1 4 Gaw Capital Partners Cambodia $- 1 0 1 Yuka Hata Andrew Hawkyard Christopher Heady Jim Hildebrandt Archana Hingorani Macau $- 1 0 1 Chief Portfolio Manager Managing Director Chairman of Asia Pacific & Head Managing Director CEO & Executive Director Alternative & Fund Investment, Morgan Stanley of Real Estate Asia Bain Capital IL&FS Investment Managers FUND-RAISING MONITOR Nissay Asset Management Corporation Blackstone Harry Hui Ryosuke Iinuma Josh Jacob Mohanjit Jolly John Kim CLOSED FUND Founder & Managing Partner Representative Director & Managing Director Partner Principal Location: India ClearVue Partners Managing Partner Hamilton Lane (Hong Kong) Iron Pillar AlpInvest Partners Ant Capital Partners Fund Name: Multiples Private Equity Fund II LLP Closing Amount: US$ 685 million (final close) Megumi Kiyozuka Charles Knight Alvin Lam Don Lam David Larsen Managing Director Global Director – M&A Senior Managing Director CEO & Founding Partner Managing Director Launch Date: May 2014 (Head of Japan), Services CVC Capital Partners VinaCapital Duff & Phelps Fund Manager/Advisor: Multiples Alternate Asset Management Pvt. Ltd. CLSA Capital Partners Japan Deloitte Stage Focus: Buyouts (MBO/MBI/LBO), Expansion/ Growth Capital, Mezzanine/ Pre- Jason Lee Kevin Lee Nisa Leung Bin Li Judith Li Industry Focus: Diversified Managing Director & Head of Asia Real Managing Partner Managing Partner Partner Partner Geographical Focus: India Estate Crescendo Equity Partners Qiming Ventures Ally Bridge Group Lilly Asia Ventures The Carlyle Group Contact: Renuka Ramnath Phone: (91) 22-6624-5555 Kevin Loh Eric Mason Darren Massara Rodney Muse Girish Nadkarni Email: [email protected] Managing Director Managing Director - Asia Managing Partner Managing Partner Partner, Private Equity Creador Investments NewQuest Capital Partners Navis Capital Partners IDFC Alternatives Website: www.multiplesequity.com The Church Pension Fund Update: Multiples Alternate Asset Management has hit the final close of $685 million for its second India-focused private equity fund, including the main fund with $550 million and the co-investment fund with $135 million. The Fund will make sector agnoistic investments in mid-sized Brian O'Connor Mark O'Hare James Pearson Alexander Pestalozzi David Pierce Indian companies, management led buyouts and spin-offs of division from large Indian groups. Canada Pension Plan Investment Board, CDC Founding Partner Founder & Chief Executive CEO Managing Director Managing Director & Group, and IFC, have committed to the fund. Falcon House Partners Preqin Pacific Risk Advisors Mueller Asia Head of Asia HQ Capital Lachmi-Niwas Sadani Simon Sham David Shen Kunal Shroff Padmanabh Sinha NEW FUNDS Founder & Managing Partner, Managing Director Regional Managing Director Managing Partner Managing Partner Location: Japan Lensbridge Capital Darby Private Equity Olympus Capital Holdings Asia ChrysCapital Advisors Tata Opportunities Fund Fund Name: Trinity Health Care II Investment Limited Partnership Target Amount: JPY 60 billion Edward Sippel Bryan Southergill Yinglan Tan Ravi Thakran Jim Tsao Managing Director Managing Director, Venture Partner Group President, LVMH South & Chairman & Head of China Launch Date: October 2016 TA Associates Asia Pacific Real Estate Sequoia Capital Southeast Asia and Middle East; Permira Advisers (China) Fund Manager/Advisor: Healthcare Management Partners, Inc. KKR Chairman & Managing Partner, L Catterton Asia Stage Focus: Bridge Loan, Expansion/ Growth Capital, Mezzanine/ Pre-IPO, Turnaround/ Restructuring Denis Tse Pote Videt Joseph Wan Vivian Wan Frances Wang Industry Focus: Medical Managing Principal Managing Director Operating Partner Operating Director Director Geographical Focus: Japan Asia-IO Advisor Lombard Cinven HK TPG Capital IDI Emerging Markets Partners Contact: Hiroshi Murayama Phone: (81) 3-6860-5501 Organiser: Co-organiser: Media Partner: Dominik Woessner Kenneth Wong Reijiro Yamamoto Website: www.hcmp.jp Managing Director Partner Founding Partner Greenhill Cogent Primavera Capital Integral Corporation Update: Mitsubishi UFJ Lease & Finance and the Development Bank of Japan (DBJ) have created a fund to invest in hospitals and nursing care providers looking to rebuild facilities or add new ones. The fund aims to raise JPY 60 billion to JPY 70 billion and it is managed by Healthcare Management Partners, a joint venture between Mitsubishi UFJ Lease and the DBJ. Dongao Yan Tommy Yip Jianyi Zhu Free LP Passes for Pension Funds, Fund of Funds, Endowments, Foundations, The Fund, Trinity Health Care II, will focus on development projects, rebuilding and new construction. Senior Vice President Founding Partner Co-founder & Partner Family Offices, DFIs and Sovereign Wealth Funds. Register: [email protected] HQ Capital Unicorn Capital Partners ADV Partners Quote "AVCJHK2017_HKVCA" code to enjoy 20% off (non-member rate) of HKVCA represents the rights to amend any details due to unforeseen circumstances. a ticket for all AVCJ subscribers Number 43 | Volume 29 | November 15 2016 | avcj.com 15 To register, please visit apef.hkvca.com.hk Tel: +852 2167 7518 Email: [email protected] GLOBAL PERSPECTIVE, LOCAL OPPORTUNITY

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