With the private equity industry growing in India, industry veterans are being hired by fund managers to help manage their portfolios and consequently bring value to their investments, The Financial Express reported. After working for large cap firms, experienced officials like Arun Nanda, S Mahalingam and Girish Paranjpe have either joined private equity funds or established their own, the report said.
TVS Capital Funds Chairman Gopal Srinivasan told The Financial Express, "As funds are making bigger deals, you need a certain skill set to work with the management alongside the regular investment partner." TVS Capital Funds got S Mahalingam, the former Chief Financial Officer of Tata Consultancy Services to become a part of its advisory board.
According to private equity funds, getting an industry expert on board as a senior advisor or operating partner translates to having deep sectoral knowledge. Advent International, for example, engages the services of a few operating partners part-time and leverage their expertise for specific firms, the report said.
Advent India PE Advisors Director Avnish Mehra told The Financial Express, "In terms of sourcing interesting opportunities, diligence on board, they (industry veterans) come with tremendous experience. The best deal-makers in the world do not have sectoral expertise." Reliance Health's former head Vikram Chhatwal was instrumental in Advent's majority stake purchase of CARE Hospitals, the report said.
A lot of private equity funds have also hired veterans to aid them in managing portfolio firms across various sectors. In some occasions, even a company's senior executives hold the view that establishing a fund can improve entrepreneurship. An example is that of ex-Infosys veteran TV Mohandas Pai. In addition to his education-focused ventures, Pai formed Aarin Capital and Exfinity Fund to aid startups, the report said.
Difficulties do exist when it comes to getting experts on board. A fund manager told The Financial Express, "Not many high-level management executives are comfortable with the part-time nature of work."
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