IDFC closes Fund III on $700m hard cap(2)

The Indian infrastructure-focused firm had to delay the final close for five months pending regulatory approval. It recently announced the first investment from the vehicle, in Indian wind turbine manufacturer SE Forge.

Mumbai-based IDFC Private Equity has closed its third infrastructure fund, IDFC Private Equity Fund III, with INR 33 billion ($700 million; €495 million) in commitments.

The fund, which had been targeting $600 million, saw its $700 million close in May this year, but had to wait nearly five months for the regulatory approval, according to Luis Miranda, president and chief executive of IDFC Private Equity. The fund is denominated in Indian Rupees.

Its limited partners were institutional investors such as pensions, family offices and insurance companies, mostly from the US and Europe. No placement agent was used.

IDFC Private Equity is a subsidiary of the Infrastructure Development Finance Company and manages two other funds: India Development Fund, which closed in 2004 on INR 8.4 billion from domestic institutional investors, and IDFC Private Equity Fund II, which closed in 2006 on INR 19.9 billion, over 70 percent of which came from overseas investors.

Just yesterday, IDFC announced the first investment from Fund III, which was also the firm’s largest. It will invest INR 4 billion into Indian wind turbine manufacturer SE Forge. The investment will help the company meet growing demand for forging and casting components in the wind energy sector, SE Forge’s director, Tulsi Tanti, said in a statement. A subsidiary of Suzlon Energy Limited, SE Forge’s large forging and casting products will cater primarily to the wind power industry.