ESG is no passing fad, as more investors are convinced that alpha can be found in ESG and regulators continue to introduce rules to lift ESG standards.
Carlyle currently has two buyout funds in Asia û Carlyle Asia Partners I and II with $750 million and $1.8 billion under management respectively. The private equity firm was in the market earlier this year to raise its third fund, Carlyle Asia Partners III.
The private equity investing arena in India is crowded and until now buoyant capital markets have provided an alternative for companies in the need of funds, which has resulted in the number of deals being few and far between. Also, Indian entrepreneurs are usually reluctant to relinquish control which means buyout-type investing is not common in the country. Carlyle's buyout side has only closed one deal in India since Gupta set up shop for the US firm. In May 2007, it paid $650 million for a 5.6% stake in India's leading mortgage provider, the Housing Development Finance Corporation.
But it is also true that financial sponsors with a focus on Asia are becoming more open to minority stakes and smaller investments in high-growth firms. There is consensus that for this type of capital the region provides immense opportunities. For many investment bankers, moving to a private equity firm is a natural choice at the pinnacle of their careers. Further, in the current environment where a number of banks are reducing headcount as well as importing senior resources from subprime-affected regions, a private equity firm may seem like a better option.
Singh is a career Citibanker who joined the US bank in India in 1989 after completing an MBA at Duke University in the US. He spent the first 10 years of his career with the corporate bank in roles in operations and as a relationship manager. He moved to the investment bank in 2001 and was head of the corporate finance and capital markets business before moving into his current position running M&A in 2006.
Citi recently hired Nalin Nayyar from Lehman Brothers as the fourth MD in its India investment banking team, which includes Pramit Jhaveri who heads the business and Ravi Lambah who was hired in May 2007 from Credit Suisse. SinghÆs departure leaves two lateral hires with less than a yearÆs experience at the US bank as JhaveriÆs senior-most resources.
Citi's investment banking practice has had a strong performance under Jhaveri's leadership, especially in cross-border outbound M&A. The US bank also has a healthy deal pipeline and is winning significant repeat business from satisfied clients such as the Tata group. Reflecting the importance of the investment banking franchise in the country, Jhaveri was in November 2007 appointed head of global banking for India, leading the unified corporate banking and investment banking client coverage in addition to his role as vice-chairman of Asia investment banking.
Neither Citi nor Carlyle responded to requests for comment about SinghÆs move.
In its second annual sustainable investment report, the sovereign wealth fund says it invested $1.79bn in ESG bonds. Experts say asset owners next need to consolidate their standards.
Senior executives at the Taiwan financial group and Canadian pension fund believe that companies have to make an ESG transition, and may not have a choice in a few years.
Record low borrowing costs in Australia are feeding demand for the country's real estate, with domestic and global investors raising their allocations into the sector.
Experts have a diversified view on the appeal of private assets across the region, but one thing's for certain - inflows are rising, particularly into China and the US.