Private equity and venture capital firms invested $126 million across nine Indian agri business companies during the first six months of 2013, 75% more than the $72 million (invested across six companies) during the same period last year, as per data from Venture Intelligence which specializes in private company financials, transactions and valuations in India. The largest private equity investment in the industry during H1 2013 was Multiples Private Equity’s Rs 250 crore ($43.24 million) investment in Bangalore-based Milltec Group which develops technology and machinery for rice milling, roller flour milling, maize (corn) milling and agro processing plants.
Another buyout focused PE firm, India Value Fund, has committed $40 million to pick up a majority stake in Kochi-based spices firm VKL Seasoning. VKL, a spin out from the Vallabhdas Kanji Group, provides seasonings and flavors to customers – typically quick service restaurants (QSR) – in India, the Middle East and Africa. In February, Qatar-based Hassad Food had acquired a 69% stake in PE-backed rice exporter Bush Foods Overseas for $135 million, fetching StanChart PE a 2.5 times return on its investment. And just last week, the publicly listed rice exporter Kohinoor Foods agreed to sell a 20% stake for almost Rs 113 crore ($18.8 million) to Al Dahra Holdings, an Abu Dhabi-based agriculture focused investment firm. “The rising appetite for such companies among overseas investors and also the higher prices being enjoyed by agri commodities in recent years could continue to sustain private equity interest in the industry,” Arun Natarajan, chief executive officer, Venture Intelligence said.