The Investment (1999-2001)
Between September 1999 and July 2001, Warburg Pincus invests $292 million in Bharti Tele-Ventures in return for a 19% stake, the first tranche being invested in September 1999. Dalip Phatak and Pulak Prasad of Warburg joined Bharti’s board.
Company Valuation: $1.537-B
The IPO (January 2002)
Bharti goes public (which, I assume, diluted Warburg’s stake to 15%.)
The Exit (2004-2005)
August 2004: Warburg sells a 3.35% stake for about $208 million.
Company Valuation: $6.210-B
March 2005: Warburg sells another 6% stake for $560 million, marking the largest ever equity deal in a single scrip on an Indian stock exchange.
Company Valuation: $9.333-B
October 2005: Warburg sells its final 5.65% stake to UK-based Vodafone for $847.5 million.
Company Valuation: $15-B or 10 times that when Warburg invested in the company five years ago.
Warburg’s total realization: $1.616 Billion – i.e., over 5.5 times its investment amount.
Arun Natarajan is the Founder of Venture Intelligence India, which tracks venture capital activity in India and Indian-founded companies worldwide. View sample issues of TSJ Media’s Venture Intelligence India newsletters and reports.
It is intersting to see that warburg made lot of money. But do you think this is one off? or do think this trend is going to continue as the private equity market starts to take shape in India?.
Hi “Anonymous”,
My feeling is that this could be a one off wrt mobile telecom services, but we will continue to see similar and even better PE success stories in other sectors.