Baring Asia is investing $100 million to pick up 40 per cent stake in RSP Architects & Planners India, thereby marking big buck private equity’s foray into architectural consultancy space, sources said. The Hong Kong fund’s investment values the decade-old Bangalore-headquartered architect at $250 million, or Rs 1,000 crore.
RSP India has about 360 employees on board, and is seen as a leading design and engineering architect for the sprawling IT campuses and parks. The firm’s portfolio of works include Microsoft campus in Hyderabad and the International Technology Park at Bangalore, while most of the country’s top real estate players figure in its client list.
It is believed that Baring Asia’s investment was in closing stages, with MAPE Advisory being the investment bank to the transaction. RSP India’s head, Gopi Bhawnani, set up the firm in 1996. He and the local management hold a strategic minority stake in the firm with the parent RSP Singapore in control of the rest. Sources said both the local management and RSP Singapore were diluting stake in the wake of Baring’s entry.
When contacted, Mr Bhawnani confirmed the deal with Baring, but did not detail the specifics. The local management is expected to continue steering the company. Baring’s move comes at a time when several global architectural giants are beginning to take a serious look at the Indian market. Nitesh Estates roped in America’s Wimberly Allison Tong & Goo to design India’s first Ritz Carlton project in Bangalore. Another global giant KPF is working on the same group’s retail projects.
Tata Housing is working with Singapore’s Ong & Ong for a just announced mixed use development in the southern metro. Other prominent international firms operating in the country include DP Architects and Architects 61, both Singapore-based, American firm Hellmuth Obata Kassabaum (HOK) and UK’s Laing O’Rourke.
According to real estate consultancy firm Asipac CEO Amit Bagaria, India’s architectural and engineering market is estimated at around Rs 1,750 crore, and growing at 25 per cent year-on-year. RSP India has offices in Mumbai, Hyderabad and Chennai, besides Bangalore. Sources said RSP India was projected to double the size of operations over the next 3-4 years, and this will see its head count move up to around 800 employees. Notwithstanding the recent slowdown, India’s real estate space is expected remain intact on the back of unique local demand-supply dynamics.
Source: Economic Times