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private equity financing

Agenda. Introduction to Private EquityCompany lifecycle financingIssues to considerAbout YENConclusion. What is Private Equity?. Equity investment into non-listed entitiesVenture capitalPrivate equityBuyout fundsFixed investment horizonExit. Financing in a Company's Life Cycle. 4. . Venture Capital.

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private equity financing

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    1: Private Equity Financing MEDC Conference August 26, 2010

    3: What is Private Equity? Equity investment into non-listed entities Venture capital Private equity Buyout funds Fixed investment horizon Exit

    4: Financing in a Company’s Life Cycle 4

    5: Why Private Equity? Growth capital to go to the “next level” Cash flow efficiencies, esp. in a downturn Balance Sheet restructuring Smart money - value add Strategic inputs Relationships and networks International expertise Best practices Corporate governance / sales / international value add One step closer to IPO 5

    6: Growth of PE in India

    7: 2009: A Difficult Year for PE…but a Bounce Back in 2010 PE investment in SMEs took a sharp dip by almost 68% and stagnated at US$ 580 million in 2009 The total number of PE deals signed by SMEs in 2009 stood at 81, while in 2008, it was 187 Overall, PE deals in India during 2009 numbered 287 amounting to $4.3 billion as against 502 amounting to $ 11.9 billion in 2008. The total value and volume of PE deals reduced by 50% and 40% respectively as compared to 2008. According to VCCEdge, the first seven months of 2010 have seen private equity deals valued at $5.1 billion, as compared to $4.3 billion in entire 2009.

    8: Case Study The Company A small company with 2 cellular licenses and 1 fixed line license Earlier into bicycle parts, gelatin capsules, and push button phones manufacturing The Investment Between 1999 and 2001, the PE investor made a series of investments totaling $292 million Adding Value They benchmarked the company’s performance against its competitors, Helped the company meet the listing requirements for an eventual IPO, Rationalized the corporate structure to better the management’s decision making Changed the composition and practices of the Board of Directors 8

    9: Key Issues to Consider Cost of capital Dilution Valuation Investor rights Non-financial benefits Fiscal discipline Corporate governance Investor exit

    10: Conclusion Think big Understand the pros and cons of PE Take assistance of experts Talk to portfolio companies Be realistic – aim for win:win

    11: About YEN SERVICES Debt syndication Private equity syndication M&A advisory MARQUEE CLIENTS Yash Birla Group Nimbus Communications Indian Hotels (Taj Group)

    12: THANK YOU! ARUN CHANDRACHUD DIRECTOR YEN MANAGEMENT CONSULTANTS PVT. LTD 93 BAJAJ BHAVAN, NARIMAN POINT MUMBAI 400 021 CELL: 98230 12303 OFF: 022-32525967

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