By Shraddha Nair and Sapna Agarwal
Of MINT
MUMBAI (Mint)--Unilever PLC, the world's second-largest consumer
goods company, is setting up a venture capital fund to invest in
India.
The company already has established the Unilever Corporate
Ventures model for developed countries and wants to leverage "the
model into emerging markets commencing with India and China," a
Unilever spokesperson said in an e-mail statement.
"The team has already been formed," said a person with direct
knowledge of the development. "Currently, it is operating in London
and will shortly shift base to India." The fund size would be
around $150 million to $200 million initially, the intent is to
raise money from third parties, said the person who is associated
with the private equity industry and didn't want to be named.
The maker of Lux brand of soaps is also considering a similar
fund in China.
India and China are exciting markets, a senior Hindustan
Unilever executive said.
"The fund will invest in areas such as media, technology and
anything that is outside of our core business area," he added, but
didn't want to be named.
Unilever's plan to have a venture capital fund in India signals
how consumer goods makers are warming up to the idea of setting up
such funds, a space traditionally dominated by technology
firms.
Intel Capital, the venture arm of chip maker Intel Corp.; SAP
Ventures, the venture arm of software firm SAP AG, and Siemens
Venture Capital of engineering conglomerate Siemens AG are some
corporate venture funds that invest in India.
Among local companies, Future Ventures India, promoted by
Pantaloon retail chain founder Kishore Biyani, and a fund managed
by Godrej Agrovet, backed by consumer goods to real estate
conglomerate Godrej Industries, are two corporate-backed venture
capital firms focused on consumer markets.
Large firms set up corporate funds to buy stakes in smaller
companies. The objective is either to buy them at a later stage or
use their technology.
Unilever already has two such funds operating since 2002.
Unilever Technology Ventures, a North America-focused fund, based
in California, invests in life sciences, materials science, clean
technology and consumer-related technology.
Langholm Capital, a London-based fund that is part-funded by
Unilever, manages around 250 million euros and invests in
mid-market private firms in high-growth consumer sectors across
Western Europe.
-Shraddha Nair and Sapna Agarwal, of India's Mint newspaper,
write for Deals India and can be reached at +91-9971113266 or
shraddha.n@livemint.com.
(Deals India, published jointly by Mint, Dow Jones Newswires and
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