Temasek opens second Indian office

The Singapore sovereign wealth fund has established an office in Chennai to expand its investment operations to southern India, where it believes the infrastructure sector is performing 'exceptionally well'.

Temasek Holdings, which opened its first Indian office in Mumbai in 2004, is setting up a branch office in Chennai.

The move to open an office in the south of the country represents “a strategic geographic diversification to focus on the large south Indian market”, the Temasek said. Thus far, the sovereign fund has been active in the north and the west of the country.

India continues to be one of Temasek’s key investment destinations within Asia, Manish Kejriwal, senior managing director and head of India for Temasek, said in a statement. “We believe that in the current scenario, with prevailing capital scarcity, private equity investments are likely to play a pivotal role in global economic recovery,” he added.

The Chennai office will be headed by R Venkatesh, director of Temasek Holdings Advisors India. “The GDP growth of the south is higher than the national average with the manufacturing, infrastructure and consumer-oriented sectors performing exceptionally well,” Venkatesh said. The firm will continue building its team for its Chennai office, he added.

Earlier this month, the sovereign wealth fund disclosed that chief executive officer Ho Ching will step down in October, to be replaced by Chip Goodyear, the former chief executive of mining company BHP Billiton.

Temasek is an active investor in private equity and makes investments directly, as well as through third party private equity funds. It is believed to have invested $1 billion in the China-focused $2.5 billion Hopu Fund, which was established by Fang Fenglei, a former Goldman executive.

It is also an investor in the FountainVest China Growth Capital Fund, a $950 million China-focused growth fund that closed in November 2008, sources have said. FountainVest Partners was established by four former Temasek executives, led by Frank Tang.

Temasek, which is owned by Singapore’s Ministry of Finance, manages assets of S$127 billion ($83 billion; €65 billion) of 30 November 2008, reflecting a decline of 31 percent in eight months.