India’s Kotak Investment Advisors launches fund of funds

The FoF will invest in private equity and venture capital funds, coupled with direct investments into companies.

Kotak Investment Advisors Ltd, the alternative assets subsidiary of India’s Kotak Mahindra Bank, has launched fundraising for a fund of funds, Kotak India Alternate Allocation Fund. The FoF, which has a target of $200 million, will invest in private equity and venture capital funds, coupled with direct investments into companies.

Venture Capital Journal was the first to report on the planned fundraising effort in June. Srini Sriniwasan, KIAL’s founder and managing director, told VCJ at that time that KIAL planned to start marketing the FoF as well as a $200 million VC fund this summer. Both funds are expected to charge the standard 2 percent management fee and 20 percent carried interest.

The FoF aims to diversify across PE/VC funds in various sectors, running the gamut from early-stage and growth-stage to late stage. It also intends to invest in co-investment opportunities available from investee funds.

“Through Kotak’s fund of funds, we intend to provide investors access to multiple funds as well as leverage our institutional diligence with peer benchmarking data available, coupled with institutional monitoring of long tenure funds,” Nidhi Chawla, fund manager of Kotak India Alternate Allocation Fund, said in a statement.

Investors in previous KIAL funds are mostly sovereign wealth funds and pensions, many of them from Southeast Asia and the Middle East. Notable LPs for past funds include Abu Dhabi Investment Authority, Allianz Germany, British International Investment and GIC, the Government of Singapore Investment Corp.

KIAL was formed in early 2005 and has raised, managed and/or advised more than $5.7 billion across different asset classes including private equity, real estate funds and special situations funds.

“We are constantly identifying opportunities across the alternative investment spectrum and curating investment platforms for our domestic and global investors with dedicated and competent investment teams with deep expertise,” Sriniwasan told VCJ in a prior interview.