14 March 2011 – Samena Capital, a premier investment group focusing on principal investments in the Subcontinent, Asia, Middle East and North Africa, collectively known as the SAMENA region, is pleased to announce the first round of investment exits in its flagship Samena Special Situations Fund. Samena Special Situations Fund, with AUM in excess of US$200MM, aims to achieve a target IRR of 25% p.a. by employing a unique collective approach to create value by focusing on building strategic minority stakes in public enterprises across the SAMENA region, that are stable mature businesses with high calibre managements and at a ‘special’ stage of their business cycle.
Bucking the overall trend of a volatile year for the industry, Samena Capital’s outperformance endorses the inherent value in melding the experience and market knowledge of its shareholders of the first generation “valuepreneurs” from the SAMENA region with the considerable investment acumen and understanding of its regulated fund managers in London and Hong Kong and research presence in Bahrain. This unique model of investing aims to generate strong returns by unlocking value through the sharing of knowledge and ideas between its stakeholders and investee companies.
The Eicher Motors investment has generated an IRR of 214% over a 23 month investment horizon, an absolute profit of US$26.4MM on a total investment of US$6.0MM. In line with its stated philosophy of taking large minority stakes in stable, mature businesses, Samena Special Situations Fund invested in Eicher Motors, India’s third largest commercial vehicle manufacturer, in March 2009. The investment made the fund the third largest shareholder in the company and a preferred partner of choice for the company. Siddhartha Lal, the CEO and Promoter of the company worked closely with the fund, attended Samena Capital Strategic Ownership Group conferences in Bahrain (April 2009) and Delhi (January 2010) and engaged in ongoing discussions in strategic areas of interest with Samena Capital.
Commenting on the investment, Samena Capital’s Founder and President, Shirish Saraf said: “The Indian commercial vehicle segment is amongst the fastest growing markets in the world, and Samena Capital saw an opportunity to invest in a world class company operating at the heart of our core SAMENA region in early 2009. We continue to view Eicher as one of the best plays in the rising dominance of SAMENA-centric companies, and under the dynamic leadership of Siddhartha Lal, we believe Eicher remains well positioned to realize its objective of capturing a 15 percent share in the domestic HCV industry over the next 3 years. The significant return on our investment reflects the strength of Eicher Motors’ management team and its commitment to innovation and partnership, and we wish the firm every success in its future endeavors.”
The CEO of Eicher Motors, Siddhartha Lal said: “Apart from having the investment acumen to unlock value in deals, the structure and shareholders of Samena makes it extremely appealing as a preferred partner, especially as businesses are increasingly looking towards cross border opportunities and cross synergizing networks and partnerships. Samena invested in us at a time when others didn’t have an appetite for it, and it has paid off well. We hope to have Samena as a partner again in the future, to be with us on our journey to transform the commercial vehicle space in India and developing markets.”
Samena Capital is uniquely capitalized with US$50 million in equity capital and currently manages approximately US$400MM of assets across a range of close-ended funds. The Eicher exit follows a similarly strong performance on exiting the senior secured Rubicon Offshore (Singapore) bond 2012 for an IRR of 73% over 20 months. Currently Samena Capital is in the process of scaling up each of its business lines through unique partnerships and ventures that will generate considerable value in the future.