Private Equity

India - PE funds to remain preferred choice for capital growth 

Source: Domain-B, 08 May 2010

Private equity (PE) funds will continue to remain preferred choice for capital growth in India with Indian industries receiving investments valued at around US$10 billion from PE deals by the end of 2010 according to the Confederation of Indian Industries' (CII) latest report jointly released by KPMG. India has a very vibrant private equity industry with over US$32.5 billion invested across more than 1,500 PE deals from January, 2006, till date.

The report adds that PE funding would be expected to provide capital to fund much-needed infrastructure projects to support 7 to 8% gross domestic product (GDP) growth in the country. The country needs about US$1.3 trillion investment over the next three years to sustain a GDP growth of 7 to 9% with PE investments contributing US$60-100 billion.

Australia - Private equity tax to be examined

Source: Australian Financial Review, 09 June 2010

Private equity tax laws are being reviewed by the federal government, who is considering intervening in the dispute between the Australian Taxation Office (ATO) and the industry. It is believed the government is exploring potential policy responses, but there is no certainty the government will respond with a policy that is favourable for private equity funds.

In May 2010, the government asked the tax office to delay issuing its final ruling on how private-equity sales are taxed, and the ATO backed the postponement. Senior tax officials however believe this might set a risky precedent, given the tax commissioner has statutory independence to administer the law.

China - PE firms see opportunities in agricultural logistics industry

Source: China Daily, 11 June 2010

Foreign private-equity (PE) investors have sniffed out lucrative business opportunities in the country's agricultural logistics industry, a largely underdeveloped and inefficient sector that has contributed to the recent sharp fluctuations in agricultural commodity prices. In March, a consortium led by US PE firm Blackstone Group purchased a 30% stake in China Shouguang Agricultural Product Logistics Park for US$600 million.

This move by foreign PE investors not only reflects China's booming agricultural logistics industry but also reveals that the sector is now in dire need of capital to build better infrastructure and more sophisticated logistics networks in order to reduce current high transportation costs. China's agricultural logistics industry is a widely dispersed sector with many small trading centers spread across the country.

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