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INDIA MARKET UPDATEFOR THE QUARTER ENDED MARCH 31, 2021
DEAL WATCHER
2
FOREWORD
Dear Clients and Associates,
With the recent advent of the second wave of pandemic, India’s healthcare system is facing its worst nightmare as the public continues its
battle to conquer the dreaded virus. Mass vaccination and the government’s commitment to restrain from nationwide restrictions has
instilled confidence in the economic outlook with the World Bank and IMF projecting a V-shape economic recovery for India. From the
lessons learned last year, the Indian Investment landscape has adjusted well to recent challenges posed by COVID-19, with the deal
making activity continuing its robust run in the preceding quarter.
With 12 startups entering the unicorn club in 2020, the first quarter of 2021 itself saw 5 startups entering the elite club with 5-6 more
joining in the first week of April. The quarter also recorded one of the highest PE-VC exit deals in the past few years. Higher stake sales
were seen due to the exemplary performance of the stock market, with the SENSEX breaking all records. However, with the fear of the
second wave escalating, fund managers believe that inflation and taper tantrum are now a greater market risk rather than pandemic-
induced interruption.
In the quarter ended March, there were over 437 private equity investments & venture capital investments with reported values of over
US$ 11.51 bn. Bank of Baroda, Mahindra Susten and Godrej Properties walked away with a significant share (16% approx.) of the
cumulative deal value. Key deals include:
• Bank of Baroda raises a colossal sum of US$ 613 mn from local and overseas investors through a qualified institutional placement.
• Brookfield Asset Management acquisition of Mahindra Susten’s engineering, procurement and construction (EPC) business along
with 1,200 megawatts (MW) of solar assets for US$ 608 mn.
It was noticed that Internet and Technology were the most sought-after sectors for the quarter (with 130 and 86 deals respectively)
followed by Healthcare (46 deals), and Financial Services (24 deals). We expect these sectors to be resilient and gain traction.
Our Deal Watcher also covers over 208 M&A transactions with Technology and Internet leading the way and witnessing the highest
number of deals (35 deals each), followed by Energy & Environment (27 deals) and Healthcare (15 deals). Some of the prominent deals
include:
• Acquisition of Dewan Housing Finance Corporation (DHFL) by the Piramal group for US$ 4.72 bn (approx.).
• JSW Steel closed the acquisition of bankrupt Bhushan Power & Steel Ltd (BPSL) for US$ 2.61 bn (approx.). The amount will be paid to
the financial creditors of Bhushan Power & Steel Ltd towards implementation of the resolution plan for acquiring the company.
We hope that this publication will act as an augmentative read amidst efforts to figure out the evolving landscape.
Vaibhav Manek
Partner – Business Advisory Services
INDEX
Sr. No. Contents Page
1 Evaluating the PE/VC Landscape 4-5
2 Private Equity and Venture Capital Deals 6-11
3 Private Equity and Venture Capital Exits 12-15
4 Evaluating the M&A Landscape 16-17
5 Mergers and Acquisitions 18-21
6 Analysis of Key Transactions for the Quarter 22-27
3
EVALUATING THE PE/VC LANDSCAPE
KNAV Deal Watcher | Quarter ended March 2021
The first quarter of 2021, succeeding one of the most
unconventional years in recent history, saw a splurge of
activity in the Private Equity and Venture Capital
landscape in the India. With large-scale vaccination
programmes in force, investors have been bullish on
Indian companies, pumping in funds across several
deals in the first 3 months of 2021. Positive projections
by the IMF and the World Bank ride on increased private
consumption and investment growth.
The investors' increasing endorsement of technology
driven startups in the current quarter was well-
highlighted by the fact that a combined total of US$ 1.11
billion funding was received by startup giants Zomato,
BYJUs and Dream 11.
This quarter saw as many as 5 startups attaining unicorn
status. Insurance provider "Digit", healthcare analytics
provider Innovaccer, tech-based construction reformer
Infra.Market, NBFC Five Star Business Finance and
baby products retailer FirstCry were the latest entrants in
this coveted club which has added new members on a
frequent basis since the past 1 year.
While there are still concerns about the second wave of
COVID-19 and new mutant virus strains, most Indian
corporates as well as investors have a positive view hence
any effect of these on the fund inflow is likely to be minimal.
Budget 2021 announcements such as the increase in the
FDI limit in the insurance sector from 49% to 74%, formation
of a single securities market code by 2022 and the impetus to
the fintech sector augur well for attracting PE/VC investments
in these industries.
The upcoming quarters are poised to see a disproportionate
share of investments going to technology driven companies.
Edtech, fintech, healthtech, and the electric vehicle industries
are set to witness prominent investments as the world realizes
the power of tech-driven companies to withstand economic
slowdowns.
Venture debt funding might prove to be an alternative source
of funds for cash-strapped startups due to a dearth of other
feasible modes of credit.
With PE/VC exits showing an increasing trend in this quarter,
it is expected that several PE/VC backed companies take the
IPO route in the coming months. Overall, investors have
shown a rising amount of confidence in the Indian economy
and as supply chains become shorter along with growth
projections of 12.5% for FY 2021-22 as per IMF, the
PE/VC ecosystem shows great growth potential.
5
Where is the Investment landscape heading towards?
PRIVATE EQUITY/ VENTURE CAPITAL DEALS
The following charts provide an analysis of the prominent PE/VC deal classifications, in terms of number of deals and
transaction values which were witnessed in the quarter.
PE/VC DEALS – DEAL CLASSIFICATIONPE / VC deals | Quarter ended March 2021
7
Out of the transactions for which values were disclosed,
the total investment in this quarter amounted close to US$
11.51 bn. The highest amount of funds were invested in
late-stage companies (US$ 6.33 bn), followed by growth
stage companies (US$ 1.25 bn), and early-stage
companies (US$ 0.75 bn).
Of the total 437 PE/VC deals in this quarter, maximum
number of deals were entered into by companies in early
stage (103 deals), followed by seed-stage companies (89
deals) and late-stage companies (86 deals).
Deal classification by count Deal classification by value (US$ mn)
2 82752
1246
3101
6327
1
69
86 89 89
103
PE/VC DEALS – SECTOR WISE ANALYSIS
8
The following charts provide an analysis of the prominent sectors which have witnessed private equity/ venture capital
investments in terms of number of deals and transaction values for the quarter.
Of the total 437 PE/VC deals in this quarter, the highest
number of investments were made in Internet Sector
(130 deals) followed by Technology Sector (86 deals)
and Healthcare Sector (46 deals).
Out of the transactions for which values were disclosed, the
investment in this quarter amounted to US$ 11.51 bn. The
highest amount of funds were invested in the Financial
Services Sector (led by the investments in Magma Fincorp
amounting to US$ 467 mn) followed by the Internet Sector (led
by BYJU’s US$ 452 mn fund raise from series of investors) and
Healthcare Sector (led by ZLC Chemicals US$ 270 mn fund
raise).
Top sectors by value (US$ mn)Top sectors by number of deals
PE / VC deals | Quarter ended March 2021
647 681 693
992 1070
1411
1655
2183
11 15 18 21 24
46
86
130
CITY WISE ANALYSIS
9
Mumbai Bengaluru NCR
Number of Deals 80 99 95
Transaction Value
(in US$ mn)4,354 1,858 1,261
Top sectors by number of deals city-wise
The following charts provide an analysis of the prominent sectors which have witnessed private equity/ venture capital
investments in terms of number of deals and the total transaction values for the quarter by the top cities.
PE / VC deals | Quarter ended March 2021
2 2 2 46
17
22
37BENG AL URU
3 3 4
79
1011
21
M UM BAI
3 3 4 4 6 7
13
32NCR
TOP PE/VC DEALS
10
Investee Sector Investor
Investment
Value
(US$ mn)
Deal Highlights
BankingICICI Prudential, Aditya Birla Sun Life,
Societe Generale, Nippon Life, LIC,
SBI Life Insurance, BNP Paribas
613
Bulge-bracket local and overseas investors invested
INR 4,500 crores through a qualified institutional
placement. Approximately 55 crore shares were
allotted at the issue price of INR 81.70 per share.
Energy and
EnvironmentBrookfield 608
Mahindra Susten’s engineering, procurement
and construction (EPC) business along with 1,200
megawatts (MW) of solar assets is to be sold to
Brookfield Asset Management Inc at an enterprise value
of around INR 4500 crores. An exclusivity agreement has
been signed in this regard.
Real Estate
Invesco Oppenheimer, GIC
Singapore, Monetary Authority of
Singapore, Goldman Sachs, Baron
Fund
511
Godrej Properties raises INR 3,750 crores via qualified
institutional placement to expand business and buy
land parcels. Approximately 2.58 crore shares were
allotted at the issue price of INR 1450 per share.
Financial
ServicesPoonawala Family Office, Sanjay
Chamria, Mayank Poddar471
Magma Fincorp raised INR 3,456 crores by issuing
preference equity shares to Adar Poonawalla-controlled
entity, Rising Sun Holdings Pvt Ltd and two members
from the promoter group in exchange for a 60%, 2.34%
and 2.34% stake, respectively.
Internet
MC Global, B Capital, XN Exponent
Holdings, Arison Holdings, TCDS,
Baron Fund, Baron Global, Tiga
Investments
460Edtech leader Byju’s has raised close to US$ 460 mn in
its ongoing Series F round led by MC Global Edtech
Investment Holdings LP.
Quarter ended March 2021
Investor
LetsVentureRedcliffe Lifescience, Prescinto
Technologies, Knoctowl Technologies
Sequoia Capital 13+Five Star Business Finance, Zetwerk
Manufacturing, Dreamplug Technologies
Accel India 12+Hella Infra, Ally Technologies, Studypad,
Zolve, Pactora, Vcomply Technologies
Titan Capital 12+Venwiz Technologies, Reallearning,
Coverplan, Epione Healthcare
12+
Notable Investments Deals
11
15+
100X.VC
Vested Finance, Prescinto Technologies,
Oktober6, Giggle Galaxy
10+Micro Degree, Dr Jackfruit, Burncal
Healthcare, Caregrades Technologies
Inflection Point Ventures 11+Vested Finance, Prescinto Technologies,
Mothersense Technologies, Mindler
Quarter ended March 2021
Venture Catalysts
PE/ VC ACTIVITY MONITOR
PRIVATE EQUITY/ VENTURE CAPITAL EXITS
13
PE/VC EXITS – DEAL CLASSIFICATION PE/VC Exits | Quarter ended March 2021
The following charts provide an analysis of the prominent PE/VC exit deal classifications, in terms of number of deals
and transaction value, which were witnessed in the quarter.
Deal classification analysis by count Deal classification analysis by value (US$ mn)
Out of the transactions for which exit values were disclosed,
the exit deals in this quarter amounted to US$ 4.95 bn. The
highest value for exits were earned via Mergers and
Acquisitions transactions (US$ 2.54 bn), followed by Funding
transactions (US$ 1.05 bn), Secondary Sales deals (US$ 0.9
bn) and IPO transactions (US$ 0.83 bn).
Of the 51 PE/VC exit deals in this quarter, maximum
number of deals were executed via Secondary Sales
deals (18 deals), followed by Mergers/Acquisitions
deals (9 deals), Bulk/Block deals (8 deals), Funding
and IPO transactions (7 deals each).
Secondary Trade Sale, 18
Merger/ Acquisition, 9
Bulk / Block , 8
Funding, 7
Initial Public Offering, 7
Buyout, 2
Merger/ Acquisition,
2538
Funding, 1046
Secondary Trade Sale,
900
Initial Public Offering, 833
Buyout, 270
Bulk / Block, 241
14
PE/VC EXITS – SECTOR WISE ANALYSIS PE/VC Exits | Quarter ended March 2021
The following charts provide an analysis of the prominent sectors which have witnessed private equity/ venture capital
exits in terms of number of deals and transaction values for the quarter.
Top sectors by number of deals Top sectors by exit value (US$ mn)
Of the 51 PE/VC exit deals in this quarter, the highest
number of exits were in Internet Sector (7 deals)
followed by Consumer Durables Sector, Healthcare and
Materials Sector (6 deals each).
Out of the transactions for which values were disclosed, the
exits in this quarter amounted to US$ 4.95 bn. The highest
exit values were recorded in Education Sector (US$ 986 mn)
followed by Consumer Durables & Apparel Sector (US$ 825
mn) and Logistics & Transportation Sector (US$ 751 mn).
Education
Consumer Durables
Logistics & Transportation
Telecom & Media
Healthcare
Financial Services
Materials
986
825
751
626
578
474
207
Internet
Consumer Durables
Healthcare
Materials
Financial Services
Capital Goods
Telecom & Media
7
6
6
6
5
4
4
15
TOP PE/VC EXITSPE/VC Exits | Quarter ended March 2021
Target Sector Sellers Exit Type
Exit
value
(US$ mn)
Deal highlights
EducationBlackstone
Advisors India, The
Chaudhry Family
Mergers/
Acquisitions1,000
EdTech Unicorn Byju's billion-dollar deal facilitated the
exit for the world's largest PE firm, Blackstone.
Blackstone has walked away with 2x returns in one and a
half years since 2019 when it acquired a 39.3% stake in
Aakash Educational Services for US$ 500 mn.
Logistics and
TransportationDVS Raju and
Family
Mergers/
Acquisitions498
DVS Raju and Family sold its 58.1% stake in
Gangavaram Port Limited to Adani Ports and SEZ. The
promoters sold around 30 crores shares at INR 120 per
share for an overall consideration of INR 3604 crores.
Telecom &
MediaWarburg Pincus
Secondary
Sales422
Warburg Pincus sold a 20% stake in Bharti Telemedia
Ltd to Bharti Airtel. It purchased the stake for around
US$ 350 mn in December 2017, thereby earning an
Internal Rate of Return of approximately 14.5 to 15.5%.
The PE firm is to receive INR 1037.8 crores in cash and
equity shares for the remainder.
Consumer
Durables &
Apparel
Elevation Capital
(SAIF Partners),
Vertex Venture
Holdings,
MegaDelta
Capital
Funding 310
FirstCry's early backers Elevation Capital, Vertex Venture
Holdings and MegaDelta Capital have exited FirstCry.
However, it has raised a large round led by US-based
private equity investor TPG Growth, PremjiInvest and
ChrysCapital. The deal is said to have been struck at a
valuation of approximately US$ 2 bn.
Healthcare
Parikh Family,
Morgan Stanley
Private Equity
Asia
Buyout 275
Founder- Promoters Parikh Family and Morgan Stanley
PE Asia sold their stakes to PE firm Advent International.
Morgan Stanley acquired a 20% stake in 2016 for INR 150
crores and sold it for approximately INR 390 crores
effectively earning an IRR of roughly 27%.
EVALUATING THE M&A LANDSCAPE
What does 2021 hold for the M&A landscape?
As the Indian economy saw a V-shaped recovery in
the aftermath of the COVID 19 pandemic, we assess
the M&A landscape in India and what can be
expected in the coming year.
On the emerging markets front, India stood in the top five,
both in the most acquisitive and the most
targeted countries’ list in early 2021.
Considerable traction has been witnessed
in transactional volumes in the spheres of
internet, technology, pharma and healthcare products,
building materials and electronic and
auto components manufacturing. EdTech and media
startups also recorded a high number of mergers and
acquisitions in this quarter.
As the M&A area looks to make a recovery, the
sale of distressed assets are likely to increase,
especially as disinvestment from non-core businesses go
up. The new budget signals the government’s intent to
continue divestment in important public sector entities,
with the potential sales of Air India and
Bharat Petroleum. The government’s focus on renewable
energy will also invite much needed investments in that
sector.
India’s fast-growing position as a manufacturing alternative
to China will also drive companies to enter M&A deals
here.
Another industry that could witness major growth
is the electric vehicle’s market as the
government incentivizes it’s manufacture and sales.
However, a proposed change in Income Tax as per
the Finance Act 2021 will have implications on the
M&A transactions in India. They will now need to consider
the deemed fair value as consideration and a seller will
have to pay tax on the deemed fair value of the capital
assets, even if the actual consideration is lower. This rule
is already applicable on transactions involving real estate
and unlisted shares, and now aims to cover slump sales
too. This amendment is presently awaiting the
President’s approval.
In 2020, several businesses realized the importance
of robust and technologically sound business models.
Due to this, India saw high number of collaborations
and partnerships. Consolidation is expected to be a major
driver for M&A activity in 2021, possibly driving the
emergence of larger Indian corporations in years to
come.
The gradual global roll-out of COVID-19 vaccines, as
well as a focused approach of the policymakers, seem to
have boosted optimism in the first quarter. The trend is
likely to continue ahead, further boosting deal activity.
KNAV Deal Watcher | Quarter ended March 2021
17
MERGERS & ACQUISITIONS
MERGERS & ACQUISITIONSM&A Deals| Quarter ended March 2021
19
The following charts provide an analysis of the prominent sectors which have witnessed merger and acquisition
investments in terms of number of deals and transaction value for the quarter ended March 2021.
Out of the transactions, for which values were publicly
disclosed, the merger and acquisition investments for the
quarter amounted to US$ 15.20 bn. The largest deal values
were witnessed by the Financial Services Sector (US$ 5.03
bn), followed by Materials Sector (US$ 2.83 bn) and
Corporate Services Sector (US$ 1.43 bn).
Top sectors by number of deals Top sectors by value (US$ mn)
Of the total 208 merger and acquisition deals in the quarter
ended March 2021, the highest deals were witnessed in the
Internet and Technology Sector (35 deals each) followed by
Energy & Environment Sector (27 deals), and Healthcare
Sector (15 deals).
333593
9871340 1367 1425
2830
5029
9 911
13 15
27
35 35
20
▪ Merger and acquisition transactions are spread domestically
and internationally. Within international transactions, deals may
involve flow of money into India (Inbound) or flow of money out
of India (Outbound). Analysis of these deal types have been
graphically represented. All other M&A deals have been
classified as Others.
▪ Domestic deals were the most common, with 132 out of the 208
deals (i.e. 63.46% of the deals, with total value of US$ 7.88 bn).
Marquee outbound deal included:
I. JSW Steel’s acquisition of Bhushan Power and Steel
through IBC route.
▪ This was followed by Inbound deals constituting 29 out of the
208 deals (i.e. 13.94% of the deals, having total value of US$
0.38 bn).
▪ There were also only 14 Outbound deals with a total deal value
of US$ 1.51 bn. Marquee outbound deal included:
I. Wipro’s acquisition of UK based consultancy firm
CAPCO for about US$ 1.4 bn.
▪ Other M&A deals constituted 33 out of 208 deals (i.e. 15.87% of
the deals, having total value of US$ 5.43 bn). Marquee deal for
this quarter included:
I. Piramal Group’s acquisition of DHFL for about US$ 4.72
bn (approx.).
Analysis of M&A deal types by number of deals
Analysis of M&A deal types by value (US$ mn)
M&A DEAL TYPESQuarter ended March 2021
Domestic, 132
Others, 33
Inbound, 29
Outbound, 14
Domestic, 7883Others, 5428
Outbound, 1506
Inbound, 383
TOP M&A DEALSQuarter ended March 2021
21
Target Acquirer/s Sector
Deal
value
(US$ mn)
Deal highlights
Financial Services 4,724
The RBI cleared the INR 34,250 crores acquisition of
Dewan Housing Finance Corporation (DHFL) by the
Piramal group. Piramal plans to merge DHFL with its
financial services business as soon as NCLT approves
the transaction.
Metals & Mining 2,615
JSW Steel closed the acquisition of bankrupt Bhushan
Power & Steel Ltd (BPSL). It has paid INR 19,350 crores to
the financial creditors of Bhushan Power & Steel Ltd
towards implementation of the resolution plan for acquiring
the company.
Corporate Services 1,425
Wipro announces the acquisition of Capco for US$ 1.45
bn. Company has US$ 1 bn funding line through a one-
year overseas loan for this acquisition. Through the
acquisition of UK-based Capco, Wipro appears to be
focused on strengthening its BFSI capabilities.
Internet 1,284
Tata Group acquires 68% stake in online grocery startup
BigBasket for about INR 9,500 crores. Tata's stake
translates into an enterprise value of INR 13,500 crores for
BigBasket.
Education 1000
Ed-tech platform Byju’s has acquired test preparation
firm Aakash Institute in a deal valued at almost US$ 1bn.
Byju’s will pay a mix of cash and stocks to close the deal.
This transaction will create one of the largest educational
group in India.
ANALYSIS OF KEY TRANSACTIONS
Sources: Economic Times, Business Today, VC Circle, CNBC
Rising Sun Holdings acquires controlling stake in NBFC
Magma Fincorp
23
INR 3206 cr
INR 125 cr
Mayank Poddar
Sanjay Chamria
INR125 cr
60% stake
2.34% stake
2.34% stake
▪ Owned by the CEO of Serum Institute of India, Adar Poonawalla,Rising Sun Holdings Pvt Ltd (RSHPL) acquired a controlling stake of60% in Mumbai based NBFC, Magma Fincorp through a preferentialshare issue.
▪ As part of the transaction, 45.80 crores shares were allotted toRSHPL for INR 3,206 crores at INR 70 per share and 3.57 croresshares, collectively were allotted to Sanjay Chamria, the ManagingDirector of Magma Fincorp and Mayank Poddar, the ChairmanEmeritus of Magma Fincorp for INR 125 crores each.
▪ This made the entire deal worth INR 3,456 crores and the net worthof the company increased over INR 6,300 crores.
▪ Post the capital infusion, RSHPL is classified as promoter of thecompany, along with the existing promoter group. Magma Fincorpand its subsidiaries are rebranded under the Poonawalla Financegroup along with simultaneous consolidation of existing services ofthe Poonawalla Finance group.
▪ The entire deal received the clearance of the CompetitionCommission of India (CCI) on 12th April 2021.
▪ RSHPL has nominated Poonawalla as the chairman of the Boardand Abhay Bhutada, current MD and CEO of Poonawalla Finance,as the MD of the new entity.
▪ This acquisition will enable RSHPL to leverage synergies in thefinancial lending space through diversifying its operations in areaswhere Magma Fincorp is present, namely, commercial finance, agri-finance, SME finance, mortgage finance, general insurance businesswith focus on rural and semi urban sectors.
▪ In addition, Magma Fincorp offers a customer base of over 5mn across 298 branches in 21 states.
Deal Rationale
SME
Finance
Diversification into
Commercial
Finance
General
Insurance
Agri
Finance
Mortgage
Finance
• Customer base of 5,000,000+
• 298 Branches
• 21 States
Transaction Value: INR 19,350 crore through a mix
of equity, convertible instruments and loans.
BPSL was brought to NCLT for insolvency in
July 2017.
The resolution plan offered by JSW Steel means
a haircut of about 60% for the creditors.
With this
acquisition,
JSW Steel
becomes
the largest
steelmaker
in India.
This
acquisition
gives JSW
Steel a
strong
foothold in
Eastern
India.
Source: VCCircle, Live Mint, Business Standard
9825
7355
5275
4018
3497
CLA
IM
(IN
RIN
CR
OR
ES
)
TOP FINANCIAL CREDITORS
JSW Steel acquires Bhushan Power & Steel
▪ Bhushan Power and Steel Limited (BPSL) has been bought by JSWSteel for US$ 2.7 bn (INR 19,350 crores), the largest acquisition in thehistory of JSW Steel. This acquisition was done through JSW’s whollyowned subsidiary, Piombino Steel Limited (PSL).
▪ A sum of INR 8,614 crore in PSL was arranged through a mix of equity,optionally convertible instruments and debt. Apart from this, INR 8,550crores was raised as equity and convertible instruments and INR 2,186crores was raised as short-term borrowings through a Special PurposeVehicle (SPV). This SPV will be merged with BPSL, so the majorportion of debt will reflect only on the balance sheet of BPSL, and it willhave to service it on its own.
▪ BPSL had defaulted on INR 48,000 crores outstanding debt andwas brought to NCLT by its creditors for resolution under Insolvency& Bankruptcy Code guidelines in July 2017. JSW Steel's resolution planfor BPSL was approved by the National Company Law Tribunal inSeptember 2019 & National Company Law Appellate Tribunal inFebruary 2020.
▪ However, the case was stuck in courts as the Enforcement Directoratehad attached BPSL's properties, due to pending investigations intofraud and money laundering allegations against the former promoters ofthe bankrupt BPSL. Earlier this March, JSW Steel had reached anagreement with BPSL's lenders that they would refund the amount tothe company in case of an adverse ruling against it by the SupremeCourt, where the BPSL case is being heard.
▪ JSW Steel had outbid two rivals—Tata Steel Ltd and the UK’s LibertyHouse Group—to acquire BPSL.
▪ With this acquisition, JSW Steel will get an integrated steel unitwith liquid steel capacity of more than 2.5 mn tonnes per annumin Jharsuguda (Odisha), making it the biggest steelmaker in India. It willalso take over two downstream facilities based in Kolkataand Chandigarh. The acquisition will help the JSW Group toestablish its presence in flat steel business in the Eastern region ofIndia.
24
Source: Business Insider, VCCircle, TechCrunch
MC Global Edtech
Investment
Holdings LPOthers
US$ 224 mn US$77 mn US$159 mn
Series F Funding
US$ 400 mn Stocks
US$ 600 mn Cash
Blackstone Group, JC Chaudhry, Akash Chaudhry to
be minority shareholders in Byju’s
Synergies Created:
Foray into Hybrid Model of Education –
Physical Classrooms + Online Learning
Value additive services to 2,50,000+
students of AESL
BYJU’s high ticket spree
▪ In the biggest deal in the EdTech sector so far, the country’s
most valued online education firm, Byju’s acquired Blackstone
Group-backed Aakash Educational Services (AESL) for about
US$ 1 bn cash and stock deal. The acquisition will extend Byju’s
footprint into the offline segment.
▪ Post the deal, Blackstone Group and AESL founders JC
Chaudhry and Aakash Chaudhry will become minority
shareholders in Byju’s. AESL will, however, continue to function
independently.
▪ Byju’s buyout of AESL is also among the largest acquisitions by
an Indian startup. It is planning to integrate Aakash’s expertise in
test preparation with its content and tech capabilities and will
make further investment once the integration is done.
▪ Beside investing in AESL, BYJU’s raised US$ 460 mn as part ofits ongoing Series F round, led by MC Global EdTechInvestment Holdings LP and participation from Facebook co-founder Eduardo Saverin’s B Capital, among other investors.
▪ The investment values the Bengaluru-based company at a littleover US$ 13 bn. This is the first investment in Byju’s this year,after the company raised over US$ 1 bn in 2020, fueled by theCovid-19 pandemic which caused a surge in online learning.
▪ Following this tranche, the collective holding of the promoters’group, which includes Byju Raveendran and family, has beendiluted to 26.09%. BYJU’s plans to use these process to fund itsacquisition of AESL and rival startup Toppr.
▪ The company became the second highest-valued Indianstartup, trailing only digital payments giant Paytm.
25
Source: VCCircle, Livemint, Hindustan Times, Business Standard
Approves takeover
More than 94% of lenders to DHFL voted
in favor of Piramal’s resolution plan
Piramal to merge DHFL as soon as NCLT
approves the plan by investing INR 10,000
Cr in the merged entity
The acquisition would give stable cash flow
and diversify Piramal’s loan book
Deal Rationale
Lenders to get INR 34,250 Cr including
INR 14,700 in upfront cash
Piramal Group receives RBI nod for DHFL Acquisition
• Ajay Piramal led Piramal Group has received the approval fromthe Reserve Bank of India to move forward with its acquisition ofDewan Housing Finance Corporation Limited. through the IBCprocess.
• DHFL was one of the earliest financial companies to enterbankruptcy. It was admitted by NCLT in November 2019 for a defaultof over INR 87,000 crores.
• The Committee of Creditors (CoC) voted in favour (94% votes) of theresolution plan submitted by Piramal Capital and Housing Finance,overlooking rival and American asset management companyOaktree Capital after the two engaged in a bidding war lasting fourrounds.
• The INR 34,250 crore Piramal plan that was finally approvedincluded an upfront cash component of INR 14,700 crores includingcash on DHFL’s balance sheet, and a deferred component payablethrough non-convertible debentures of INR 19,550 crores. The StateBank of India-led CoC is now in the process of filing the plan to theNational Company Law Tribunal.
• Piramal plans to merge DHFL with its wholly ownedsubsidiary Piramal Capital & Housing Finance Limited, its financialservices business as soon as the National Company Law Tribunal(NCLT) approves the transaction, thus adding 4,500 employees tothe group and investing INR 10,000 crore of Piramal Capital’s equityin the merged entity.
• This acquisition facilitates the diversification of Piramal group's loanbook and is a step towards the demerger of the group’s financialservices and pharma businesses in future.
• Piramal Capital & Housing Finance Ltd. now aims to sell its biggest-ever bond, by seeking bids for as much as INR 3,000 crores (US$414 mn) of notes and will use the money to partly fund thetakeover of DHFL.
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Source: VCCircle, Economic Times, Crunchbase, Inc 42
THE DEAL
Total funding received US$ 315 mn
Valuation after funding US$ 2.1 bn
Who is entering? Who is exiting?
03
01
02
Primary + Secondary
components
FirstCry roars with entry of TPG Growth led consortium
▪ Online first-baby products retailer, FirstCry has raised US$ 315 mn in around led by US based private equity investor TPG Growth and thehomegrown Premji Invest and Chrys Capital in a combination of primaryand secondary components at a valuation of US$ 2 - 2.1 bn. Thisdevelopment has doubled the Softbank backed venture’s valuation inless than 24 months.
▪ All the 3 new investors have pumped in about US$100 mn each coupled with a small primary component of US$ 13 mn asper regulatory filings.
▪ This deal also marks the exit of 3 early investors - Elevation Capital(formerly SAIF Partners), Vertex Ventures and Mega Delta CapitalAdvisors. All the 3 incoming partners have considerable consumer andretail investing experience having backed a diverse host of venturessuch as Nykaa, Book My Show, Dream 11 and Myntra.
▪ Brain Bees Solutions Private Limited, the company whichoperates FirstCry, did not disclose the use of its newly raised capitalin regulatory filings but it has plans to expand its presence in the MiddleEast and set-up shops in new markets such as Oman and SaudiArabia. FirstCry currently operates more than 300 stores in 125 citiesand sells more than 2 lakh kid products.
▪ This round offering comes amid a promising performanceby FirstCry for the year ended 2020, where it clocked a 68% increasein revenue, from INR 535 crores in FY2019 to INR 897 crores andan 83% drop in net losses from INR 933 crores in FY2019 to INR191 crores in FY2020.
▪ Apart from being a baby products retailer, FirstCry also ventured intothe pre-primary education segment in 2019 by acquiring Oi Playschooland rebranding it as FirstCry Intelliots in a co-generic acquisition model.
▪ Competing with corporate big shots like Procter & Gamble, Unilever,Kimberly Clark, Johnson & Johnson and Nestle, FirstCry is in a highgrowth market and this funding will help it consolidate its investor baseahead of a potential IPO in the next 18 to 24 months.
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