News: Reliance plans $500 mln private equity fund

(RTR 25/09/2006) Mumbai - Reliance Capital Ltd. plans to raise $500 million from foreign institutional investors by March 2007 for a private equity fund, a company official said on Monday.

"We have already had successes with private equity. This is the first time we will be raising funds from external investors for private equity investment," the official, who did not want to be named, said.

He said the company was in talks with JP Morgan and Deutsche Bank for the private equity fund, first reported by The Economic Times on Monday.

The company is a part of the Anil Dhirubhai Ambani group, which also has interests in telecommunications and power. It was formed last year after the Reliance group was split between Anil and his brother, Mukesh Ambani, who controls Reliance Industries Ltd.

Last month, Matrix Partners, a U.S.-based private equity firm, said it had set up a $150 million fund with an Indian partner.

JM Financial Ltd. said in August it had teamed up with U.S.-based Old Lane Partners LP to launch a private equity fund of $150-175 million.

Private equity deals have increased in India as companies seek capital to fund growth, acquisitions and expansions. A booming stock market has added to deal making.

Private equity deals rose sharply to $3.5 billion across 146 transactions in the first half of 2006, compared with $795 million through 67 deals in the same period last year, according sector tracking firm Venture Intelligence.