UK based private equity firm 3i will retain presence in India even as an ongoing global restructuring programme prompts the firm — said to be the world’s largest listed PE outfit — to close down its key Hong Kong and Shanghai offices.
Although the move is aimed at pruning costs, sources said that it also underscores the growing importance of the Indian market compared with other markets in Asia. The move to continue operations here also comes against the background of 3i’s recent plan to cut its global headcount by about 15% owing to the tough market conditions.
The offices that will continue to operate include Mumbai and Singapore. The Mumbai office will coordinate the firm’s investments for companies across the country, while Singapore will be the hub for the whole of Southeast Asia. 3i Singapore will be responsible for investments in Singapore, Indonesia, Malaysia and Thailand.
As part of the restructuring, 3i’s offices in Hong Kong and Shanghai will be closed and the executives will be relocated to Beijing.
Of the eight investment executives located in Hong Kong, Shanghai and Beijing, two are reported to have left the firm, while the remaining six will move to Beijing.
In addition to the $920 million invested in Indian companies since 2005, 3i’s India Infrastructure Fund raised about $1.2 billion earlier this year. Even in terms of total investments, India scores over China. Since 2003, the firm has invested $300 million in China.
3i’s shares have declined by 35% on fears that the current macroeconomic conditions globally could impact the firm adversely.
Source: Economic Times