Month: January 2017
China establishes US$1.44 billion Asia Fintech Fund of Funds (FOF) focusing on M&A deals
The influence of China in advancing fintech is likely to grow even stronger in 2017 with the establishment of Asia FinTech Fund Of Funds (FOF) which has accumulated a substantial funding of 10 billion yuan (approximately US$1.44 billion) to invest in fintech startups across Asia.
Based in Beijing, the foundation was formed on December 27 and is led by Hong Kong-listed Credit China FinTech Holdings along with a number of other Chinese companies such as Shanghai Xinhua Distribution Group, China Huarong International, Jilin Province Investment Group Corp Ltd and seven other corporate partners.
“In addition to the aforesaid state-owned enterprises and private enterprises, China Cultural Industry Association, New Times Trust Co Ltd, Shenzhen China Create Group, N-Securities Co Ltd, Beijing Yongyu Investment, Tianjing Borong and Juntong Capital are also partners of the fund,” Credit China FinTech said in a statement,
The fund will primarily be used to target financial and tech mergers and acquisitions (M&A) in Asia, with investments, focused on fintech fields such as big data, artificial intelligence, mobile payments, supply chain financing, and blockchain technology.
“The fund already has projects in the pipeline, covering big-data driven consumption financing, blockchain infrastructure provision, and AI-based credit service platforms,” according to Xie Sha, the Managing Partner of Asia Fintech FOF.
The investment fund also comes as a signal showing China’s growing status in dominating the financial and technology market in the international platform.
A report released by DBS and consultant EY has also ranked China as the number one fintech destination, overtaking London, New York and Silicon Valley as the world’s “FinTech Hub”.
This result is largely contributed by the developments across multiple hubs, such as Shanghai, Beijing, Hangzhou in East China’s Zhejiang Province and Shenzhen in South China’s Guangdong Province.
On a similar note, the Asia FinTech FOF, also comes as the second fund of funds (FOF) after the Zhongguancun FOF, which was established in 2015 with an allotted fund of 30 billion yuan (approximately US$ 4.32 billion).
Asia FinTech FOF attempts to establish growth in the fintech industry is another attempt in China’s cap to establish its economic dominance in the Asia-Pacific region- especially if Beijing can compete with Singapore or London in the fintech sector.
“Leveraging on the fund partners’ experiences and competitive advantages in brand recognition, industry resources, and expertise, the Fund aims to invest in innovative FinTech enterprises with potential and help them to be the FinTech leaders with our technical know-how and capital resources,” said Sheng Jia, the Credit China FinTech Executive Director.
By Vivian Foo, Unicorn Media
India-based instantPay secures pre-Series A funding from RB Investments, Kaleden
A digital payments and financial services startup, instantPay has announced that it has secured its pre-Series A funding round from Singapore-based investors – RB Investment and Kaleden Holdings.
“It is rare to find a small company that has remained cash positive in this industry,” Gurinder Singh, the managing director at Kaleden Holdings commented in regards to the investment.
The exact amount raised was not disclosed, but it was reportedly said to be in the range of Rs 20 crore to Rs 34 crore (about US$3 to US$5 million).
These latest proceedings will be used for talent acquisition, developing new products as well as the geographical expansion across India. Additionally, part of the New Delhi startup funding will also be used for brand-building and marketing.
Launched in 2012 by Sankalp Shangari, Shailendra Agarwal, and Mohammad Rehan, instantPay is a business unit of SMSdaak India Limited, which provides more than 100 products and services which facilitate digital payments at Kirana stores in tier-2 and 3 cities.
The products and services are distributed through over 400 corporate strategic alliances and through a nationwide network of micro-merchants, offering services which include electronic mobile recharges, DTH and utility bill payments, insurance premium payments, travel bookings, domestic remittance etc.
Additionally, their financial institutions and merchants can also provide a host of supplementary services to their consumers, thus up-selling and cross-selling their existing portfolios. The platform currently has over 62,000 merchants and targets to cross 120,000 merchants by March 2017.
“While we build this massive network, we are also enabling other products and services to be delivered via this distribution directly and efficiently,” said Sankalp Shangari, the cofounder of instantPay.
At the moment, instantPay claims to be processing around 10 million transactions per month and is looking to touch the 50 million mark by FY18.
Besides, the company has also been profitable, having closed FY16 “net positive in a few lakh”. For FY17, the startup is aiming at a 20% leap in growth with a four-fold jump in revenue for FY18.
“Companies should target to make unit economics sustainable before taking long bets in the market and aggressively aiming for market share,” said Rajesh Bothra, the Managing Director at RB investments.
The investors also add that the key challenge for companies in this space in the upcoming year would be to mitigate cyber security risks following a surge in business due to demonetisation.
At present, the company’s network comprises of more than 50,000 outlets across districts in India, for leading telcos and direct to home service providers.
By Vivian Foo, Unicorn Media
Everstone makes third healthcare acquisition, investing US$35 million in OmniActive Health
India-based private equity (PE) fund Everstone Capital has invested US$35 million (about Rs 232 crore) in Mumbai-based nutraceutical ingredient player OmniActive Health Technologies for a significant minority stake on Monday.
OmniActive Health Technologies is a leading supplier of naturally sourced ingredients for eye health, weight management and heart health to global nutraceutical companies that provide food supplements and nutritional fortification.
The company is equipped with the state-of-the-art manufacturing facilities, R&D centers across India and Canada, as well as sales and marketing presence across the United States, Europe, and Aisa. This latest capital will be used to help OmniActive in diversifying and expanding its offerings and implement its inorganic growth strategy.
“We welcome this partnership with the Everstone Group .with the support of its experienced teams and funding, OmniActive looks forward to building on our history of solid organic growth by further strengthening our presence globally using innovative products and technologies,” said Sanjaya Mariwala, the managing director of OmniActive Health.
“This will be done by also growing inorganically to bring a wider product portfolio of responsibly make ingredients to our customers through our strategic acquisitions,” Mariwala added.
Founded in 2005, OmniActive, over the last decade, has emerged as the leading nutraceutical ingredient supplier to international markets from India, helped by the gradual shift in the nutraceuticals sectors towards the increasing demand in the consumption of natural products.
In the last 18 months, the nutraceutical firm claims that it has completed 12 human clinical trials in healthy populations across its portfolio of branded ingredients. The company also holds a strong presence in the United States and is working to achieve similar success in Europe and Asia.
As part of the deal, Everstone will be represented by Deep Mishra, the Managing Director at Everstone India, who will join OmniActive’s board as a nominee director, along with Dr. Leendert Staal, an internationally reputed nutraceutical expert who was the CEO of the global industry leader DSM Nutritional Products from 2008 to 2013.
Co-founded by Sameer Sain and Atul Kapur, former Goldman Sachs executives in 2006, Everstone Capital has been an active PE investor in India. The PE major assets that it has US$3.3 billion under management, as well as around 200 employees working across five offices located in Mumbai, Delhi, Bengaluru, Mauritius, and London.
“This investment aims at helping OmniActive scale its already strong presence in the fast-growing nutraceutical space. We are excited about partnering with the Mariwala family and building a world-class global business,” said Sameer Sain, the co-founder and managing partner of Everstone Group.
With this deal, the OmniActive investment will also become the fifth acquisition from its third PE fund – Everstone Capital Partners III that it has closed in September 2015 as well as the company’s third acquisition in the healthcare and wellness sector which has completed in less than a year period.
Everstone acquired a majority stake in Mumbai-based drug delivery technology firm Rubicon Research Pvt. Ltd, a pioneering drug delivery technology company for approximately $33 million in October 2015. Preceded by a majority stake in Ascent Health, an Indian pharmaceutical delivery services provider, in March.
Avendus Capital advised OmniActive on this deal as the investment banker.
By Vivian Foo, Unicorn Media
Galaxy Holdings, Puji Capital announces joint venture platform to back foreign businesses in Shenzhen
Asia-based investment group Puji Capital and China-based property developer Galaxy Holdings has recently announced a joint venture agreement to create a new economic and business region in Shenzhen.
With this partnership, the two companies will be providing direct investments and act as a business incubator for foreign startups to expand in China and other high-growth markets in Asia.
This new joint venture platform is also projected to spark innovation and bridge cross-border business cooperation between China and Western countries through investment and business support.
Commenting on the deal, the CEO of Galaxy Holdings, Yao Huiqiong said, “This new platform will create new jobs and economic benefits for the city and truly define Shenzhen as the new innovation capital for China and Western business.”
“As a Special Economic Zone that is only 30 minutes’ drive from Hong Kong, Shenzhen has the most developed infrastructure and business environment in the country to help companies reach full potential,” Yao added.
Additionally, the joint venture will also target and invest in more than 10 small to medium-sized Western growth companies in each of the three core industry sectors – mobile gaming, media technology, and consumer hardware
The two companies also aim to develop separate joint ventures to enter and expand into China market, capitalise each on the rapidly growing Chinese consumer market, and establish strategic positions along the respective industry ecosystems.
“Shenzhen is already known as the epicenter of China’s booming internet, mobile, hardware, and new technology industries. With a population of 22 million, a leading growth rate among all the Tier 1 cities and the highest ratio of young professionals from 20 to 30 nationwide, Shenzhen is undoubtedly the most vibrant business city in China and positioned to be the Silicon Valley of the East,” Yao said.
Based in Shenzhen, the new innovation and business hub has already developed programmes with a preferred network of strategic partners across China for co-investments, commercial cooperation, distribution, and point of sale opportunities for Western companies the platform invests into.
“We are uniquely positioned in the market as we have participated in various cross-border investments and provided related advisory between China and the West for over 15 years,” said Alex Szeto, the Investment Director at Puji Capital.
“We have seen nearly every iteration of pitfalls and pain points for Western companies entering China,” he further explains. “So, now when we make direct investments into the US and Western companies coming to China, we can also provide a tailored and turnkey solution and strategy for success. Galaxy (Holdings) is a cornerstone brand name throughout China and we are beyond thrilled with this new venture with them.”
Founded in 1988, Galaxy Holdings is a China leading conglomerate which primarily focuses on businesses in four key areas — Real Estate, Industrial, Property Management, and Finance.
At present, the firm has a total asset scale over US$15 billion, with its real estate business expands throughout 13 cities across Pearl River Delta, Yangtze River Delta, Circum-Bohai-Sea Region, and more.
By Vivian Foo, Unicorn Media
Hathway Cable Unit GTPL Hathway files papers for IPO to raise US$45 million
Cable TV and broadband internet services provider Hathway Cable & Datacom Ltd has intimated a potential initial public offering (IPO) listing on Monday where the company is looking to raise Rs 300 crore (approximately US$45 million).
The IPO filing of Draft Red Herring Prospectus was completed by its material subsidiary, GTPL Hathway Pvt. Ltd with the Securities and Exchange Board of India as well as with both the Stock Exchanges, i.e. BSE Limited and National Stock Exchange of India Limited.
The GTPL Hathway IPO was approved by the Hathaway’s board since August 2016.
As per details of the draft prospectus, the company notes that its IPO will seek to raise funds for GTPL through a fresh issue of equity shares while giving an option to existing GTPL shareholders to sell their holdings.
Offering cable TV and broadband services, GTPL Hathway is one of the largest cable television operators in India, found in several cities which includes Pune, Ahmedabad, and Kolkata.
Despite being one of the many subsidiaries and partnerships owned by the listed Hathway Cable and Datacom Limited, GTPL Hathway is arguably one of its most profitable associations as well as one of the largest contributors to Hathway’s consolidated numbers across major financial and operational parameters.
On the other hand, Hathway’s own cable TV operations span across almost 140 cities, alongside their broadband service which is provided in 21 cities across the country.
At present, Hathway has approximately 1.4 million broadband customers base which the company claims to constitutes approximately 52% of the total cable broadband market in India.
Besides Hathway, who owns a 50% stake of GTPL Hathway, other major shareholders include co-founders – Aniruddhasinhji Jadeja and Kanaksinh Rana – who owns a direct 14.6% alongside another indirect 29.1% through shareholding entity Gujarat Digi Com Private Limited and 5.2 per cent shares of GTPL respectively.
Shares of Hathaway Cable & Datacom Ltd was last trading in BSE at Rs, 34.55, which shows a Rs 0.25 increase as compared to the previous close of Rs34.30. The total number of shares traded during the day was 12593 in over 88 trades.
The stock hit an interday high of Rs 34.74 and intraday low of 34.25. The net turnover during the day was Rs.434100
The demerger will be subjected to requisite approvals from the shareholders, creditors, high courts, DoT, stock exchanges, Sebi and other applicable regulatory authorities.
The company has hired JM Financial Institutional Securities Ltd, BNP Paribas, Motilal Oswal Investment Advisors Pvt. Ltd and Yes Securities (India) Ltd to manage the initial share sale.
By Vivian Foo, Unicorn Media
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