Religare acquires majority stake in Northgate Capital
23 February 2010
Religare Enterprises Ltd., a global financial services group has agreed yesterday to acquire a majority stake in US-based Northgate Capital, a leading global private equity and venture capital firm.
New-Delhi-based Religare, owned by the family of industrialist Malvinder Singh which ran pharmaceutical firm Ranbaxy Laboratories till it was sold to Japan's Daiichi Sankyo for Rs10,000 crore in 2008, said its board has approved a plan yesterday to spend $1 billion Rs4600 crore) for global acquisitions.
Under the deal, Religare will acquire approximately 60 per cent stake in the Danville, California-based Northgate Capital, while its five co-founders will hold the remaining 40 per cent.
Although the financial terms of the transaction were not disclosed, a deal of this type and size could value Northgate at approximately $200 million (Rs1,000 crore) say analysts.
Northgate Capital Group, founded in 2000 with $3 billion under management, is a principal investment firm specialising in fund of funds investments. The firm typically invests in venture capital, buyouts, and growth capital funds.
Northgate's five co-founders will continue to run its operations while having controlling interests in the general partner private equity and venture capital funds it has invested in.
''This partnership will accelerate our process of seeking similar partnerships in other asset classes, including both alternatives and traditional in developed and emerging markets," said Sunil Godhwani, CEO & managing director of Religare Enterprises.