News: Private equity players board India Inc
(ET 23/03/2006) New Delhi - A new breed of members is becoming a fixture on the boards of Indian companies. More than 150 domestic companies have private equity investment bankers on their boards, and their tribe is growing rapidly.
It is estimated that more than 500 deals have take place in the five-year period between ’00 and ’05, in which a sum of between $6bn and $7bn has been invested in Indian companies. Experts believe a majority of these companies have private equity members on board.
Every private equity firm now has fund managers sitting on multiple boards. For example, Temasek has its investment managers on at least 5-7 boards, for instance, ICICI OneSource, Matrix, Welspun and Shringar Cinemas.Private equity folks sitting on boards say they are not just taking care of their investments, but are fully involved in all major board functions.
“The private equity board members are on the boards not necessarily to protect their own interests, but to represent the long-term interests of all shareholders. We get involved in long-term strategy formulation, M&A/growth issues, and offer inputs on their capital market approach.
Ideally, we are insiders who are trusted by the majority owner, external shareholders and the professional managers. It’s a commitment that requires a lot of time and something we take very seriously,” says Manish Kejriwal, MD, Temasek.
Another active private equity firm, ChrysCapital, has 7 members of its team on various boards. In fact, senior MD Ashish Dhawan sits on 5 boards, including that of Suzlon, MphasiS, Yes Bank, Simplex and GlobalVantage. Another ChrysCapital MD, Brahmal Vasudevan, sits on the boards of four companies.
“I believe that private equity folks tend to be more active than others as there is an economic ownership, and we have a stronger incentive to do so,” says Mr Dhawan.US-based private equity major General Atlantic’s MD Abhay Havaldar sits on the boards of Jubilant Organosys and Geometric Software, while his colleague Mark F Dzialga sits on the Genpact board.
It’s the same story in most firms, says Bain, a global management consulting firm. Most of the private equity fund managers have held senior positions in top-notch companies, investment banks or consulting firms, and often have global exposure.
There was a time when lawyers, CAs, ex-CEOs and bureaucrats filled the ranks of board members, but new categories of people like private equity managers and management professors are making their presence felt too.
It is estimated that more than 500 deals have take place in the five-year period between ’00 and ’05, in which a sum of between $6bn and $7bn has been invested in Indian companies. Experts believe a majority of these companies have private equity members on board.
Every private equity firm now has fund managers sitting on multiple boards. For example, Temasek has its investment managers on at least 5-7 boards, for instance, ICICI OneSource, Matrix, Welspun and Shringar Cinemas.Private equity folks sitting on boards say they are not just taking care of their investments, but are fully involved in all major board functions.
“The private equity board members are on the boards not necessarily to protect their own interests, but to represent the long-term interests of all shareholders. We get involved in long-term strategy formulation, M&A/growth issues, and offer inputs on their capital market approach.
Ideally, we are insiders who are trusted by the majority owner, external shareholders and the professional managers. It’s a commitment that requires a lot of time and something we take very seriously,” says Manish Kejriwal, MD, Temasek.
Another active private equity firm, ChrysCapital, has 7 members of its team on various boards. In fact, senior MD Ashish Dhawan sits on 5 boards, including that of Suzlon, MphasiS, Yes Bank, Simplex and GlobalVantage. Another ChrysCapital MD, Brahmal Vasudevan, sits on the boards of four companies.
“I believe that private equity folks tend to be more active than others as there is an economic ownership, and we have a stronger incentive to do so,” says Mr Dhawan.US-based private equity major General Atlantic’s MD Abhay Havaldar sits on the boards of Jubilant Organosys and Geometric Software, while his colleague Mark F Dzialga sits on the Genpact board.
It’s the same story in most firms, says Bain, a global management consulting firm. Most of the private equity fund managers have held senior positions in top-notch companies, investment banks or consulting firms, and often have global exposure.
There was a time when lawyers, CAs, ex-CEOs and bureaucrats filled the ranks of board members, but new categories of people like private equity managers and management professors are making their presence felt too.
posted by InCar Group Press Room at 23:43
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