Tata Capital, a subsidiary of Tata Sons, has tied up with Japanese securities firm Mizuho Securities to raise a private equity fund in Japan.
The $500 million fund will invest in equity shares of unlisted mid-sized Indian companies.
Tata Capital sources confirmed the development. They added that the Mizuho group is also likely to make proprietary investments in the fund. They refused to give further details.
Interest rates in Japan are hovering around zero levels for years now and investors there are looking at overseas investments to make any returns at all.
Experts said the Tata fund, therefore, has a huge potential.Earlier Bloomberg, quoting the Nikkan Kogyo newspaper, reported that the fund will raise several tens of billions of yen.
Tata Capital's plans to launch a private equity fund were announced six months ago, when the company unveiled its new logo.
“We are raising $350-500 million through private equity for deployment in mid-size companies. However, it would depend upon market conditions. We are looking at both domestic as well global markets to raise this fund,” Tata Capital managing director Praveen P Kadle had said in December 2008. The proceeds would be deployed in the manufacturing and services segments, mid-size companies and growth areas, he had said.
However, he had not said anything about the tie-up with foreign firms at that stage.
Source: DNA India