Private equity is an open term for any equity type investment in a company that is not listed
on a stock exchange. It is type of asset class which consists of equity securities in companies.
Holders of PE investments will usually realize value on an average in the form of
capital gains through a sale to, or merger with, a competitor in the same sector; sale to another
private equity investor; or by eventual flotation on the stock market.
Due to the booming market and the talent shortage, PE firms now look for more avenues
in this sector and are investing heavily in it. Gone are the days when PE firms invested in
real estate, which included investments in Unitech, DLF, etc. A survey by Venture Intelligence
reveals that 80.5% PE firms are looking for investments in the education sector in the next 6-8 months.
Franklin Templeton Asset Management (India) Private Limited chose the education
services sector for one of its first investments, after successfully closing its PE fund last year. Through
its Franklin Templeton Private Equity Strategy, a Rs. 6.3 bn fund, the India arm of the US-based
fund management firm has invested Rs. 500 mn (US$10.4 mn) in Career Point Info systems
Limited (`Career Point' Helix Investments), which has taken an equity stake in the Mumbai-based
Learning Mate Solutions Pvt. Ltd. (`Learning Mate'), an e-learning education solutions provider. Here,
the investment size is around $10 mn. The company sells its applications to education
publishers, online schools, universities, government agencies and non-profit organizations.
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