KKR co-founder Henry Kravis has highlighted the emerging markets as “really tough” places to pick up controlling stakes in companies, singling out India as a particular problem.
Kravis blamed the prevalent family-owned businesses structure in India for the difficult nature of the buyout type according to Reuters.
The country has long been awash with family businesses unwilling to relinquish control in favour of tapping banks for loans, but rising interest rates are persuading more to do deals with private equity.
Private equity investment in India was down more than two thirds in the third quarter of last year compared to the same period in 2012, recent research has shown.
About $1.3bn was invested across 75 deals in the last quarter according to research by Venture Intelligence, well down on the $3.9bn in 126 deals from 12 months previous.
More than $5bn of buyout investments were made in the country through 281 deals in the first three quarters, although that was down more than a third compared to the $8.1bn across 373 deals in the same period of 2012.
IT businesses scored almost half of all PE investments in India in the last quarter, including the only two deals which broke the $100m mark.
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