(Bloomberg) -- Indian private equity firm Multiples Alternative Asset Management Pvt is seeking more than US$300 million in a secondary deal to give the firm more time and money to hold on to at least two of its assets, according to people familiar with the matter.
The Mumbai-based firm, backed by Canada Pension Plan Investment Board, plans to use a structure known as a continuation fund to retain its stake in Vastu Housing Finance Corp. said the people, who declined to be identified citing private information. Multiples also plans to extend its ownership of APAC Financial Services Pvt through the continuation fund, the people said.
The plan is preliminary and the firm could add more assets to the fund or remove an asset, the people said. It could also decide not to proceed with the continuation fundraise, depending on investor interest, they said.
A Multiples spokesperson declined comment.
The India-focused private equity firm, with close to $3 billion of assets under management, takes minority and majority control across sectors ranging from entertainment to financial services and logistics platforms in India. Canada Pension Plan Investment Board has committed capital to the firm across its funds.
Multiples invested in Vastu in 2016-2017 and in APAC Financial in 2018. Since then, it has sold part of its stake in Vastu to TA Associates Management LP.
Multiple’s efforts to raise a continuation fund follow one of the largest raises in the region for this type of fund by ChrysCapital Management Co., which raised $700 million this year to hold on to its four per cent stake in National Stock Exchange of India Ltd.
Continuation funds are a new portfolio management tool that allows private equity managers to move assets around more easily in a bid to hold them longer. A firm can raise a continuation fund to move a single asset or multiple investments from prior funds. Investors can either roll over their commitments into the new vehicle or add fresh capital with new economic terms, or they can cash out.
Continuation funds are relatively rare in Asia though they have gained traction in the U.S. and Europe. Sponsor-led funds accounted for 43 per cent of the $72 billion secondary transaction volume in the first half of this year, according to a report by Evercore Inc. These transactions grew 94 per cent year-on-year in the first half, rebounding to 2021 levels, the report showed. Asia-Pacific accounted for just two per cent of volume, according to the Evercore report.
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