ADB Invests $100 Million in NIIF to Support India’s Private Equity Industry
MANILA, PHILIPPINES (30 March 2020) — The Asian Development Bank (ADB) and National Investment and Infrastructure Fund (NIIF) of India announced today that they have signed an agreement for ADB to invest up to $100 million equivalent in Indian rupees (INR) into the NIIF Fund of Funds. ADB’s investment will support the growth of India’s private sector by helping the country’s maturing private equity industry to efficiently raise capital from international and domestic institutions.
ADB joins the Government of India and Asian Infrastructure Investment Bank (AIIB) as investors in NIIF Fund of Funds, which has now secured $700 million in commitments. ADB’s investment is expected to help attract new investors to NIIF Fund of Funds and enable it to reach its $1 billion target size.
“ADB is proud to partner with NIIF in this landmark transaction especially at a time when countries globally, India included, are facing unprecedented challenges," said ADB Vice-President for Private Sector and Public–Private Partnerships Diwakar Gupta. “ADB’s investment in NIIF Fund of Funds will help catalyze institutional capital into domestic private equity funds in India, thereby contributing to greater availability of long-term growth financing for private sector companies and leading to the creation of quality jobs, social infrastructure development, and economic growth.”
NIIF Managing Director and Chief Executive Officer Sujoy Bose said: “ADB’s commitment to NIIF Fund of Funds during these extraordinary and challenging times is highly meaningful. It reflects ADB’s confidence in the continued growth and potential of the Indian economy, its skilled private equity fund managers and the large pool of determined entrepreneurs who seek capital to grow and strengthen their companies. With this capital infusion, NIIF Fund of Funds will be able to increase its support to India-focused private equity fund managers at a time when global fundraising prospects may be challenging in the short term.”
ADB’s investment contributes to the fund of funds component of the strategic NIIF initiative by the Government of India. NIIF currently manages over $4 billion of capital commitments across three funds, each with its distinct investment strategy. NIIF’s direct funds are focused on large investments in infrastructure and associated sectors.
NIIF Fund of Funds was established in 2018 and invests in private equity funds managed by India-focused fund managers, with a focus on smaller and medium-sized enterprises that require growth equity to further scale up their businesses. So far, it has made commitments to three private equity funds aggregating more than $350 million in INR equivalent, which invest across several segments including green infrastructure, middle-income and affordable housing, and entrepreneur-driven middle market growth companies operating across diversified sectors. The managers of the three funds have been able to raise an additional $1.1 billion alongside NIIF’s investments, demonstrating NIIF’s ability to crowd-in capital alongside its own investments.
ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 68 members—49 from the region.