NDB to invest USD 100 million in NIIF Fund of Funds

The announced investment supports NIIF’s and NDB’s common goal of investing responsibly in a number of sectors that support the growth and economy of India.

Created On: Feb 12, 2021 12:18 ISTModified On: Feb 12, 2021 12:18 IST
NDB investment in NIIF FoF

The National Investment and Infrastructure Fund- NIIF announced on February 11, 2021, that the Shanghai-based New Development Bank has committed to invest USD 100 million, which is around Rs. 728 crores, in NIIF Funds of Funds- FoF. The multilateral development bank has been established by the BRICS countries. 

The FoF, with the NDB’s investment, will be able to secure USD 800 million in commitments. With this decision, NDB has joined the Asian Infrastructure Investment Bank- AIIB, Indian Government, and the Asian Development Bank- ADB as an investor in FoF.

Set up as a Category II Alternative Investment Fund in 2015, currently, the NIIF manages three funds with distinct strategies- Funds of Funds, Master Fund, and Strategic Opportunities Fund.

The announced investment supports NIIF’s and NDB’s common goal of investing responsibly in a number of sectors that support the growth and economy of India.

NDB’s first equity investment into India:

According to the official statement, this investment will mark the New Development Bank’s first equity investment into India and its ever investment into a Fund of Funds.

With this investment in the FoF, NDB aims at supporting private capital investments in India at a time when Indian companies are seeking much-needed equity to achieve their long-term growth.

About Fund of Funds:

It was established in 2018 with an aim of providing homegrown Indian private equity fund managers access to an India-focused institutional investor that operates at scale.

NIIF, through FoF, aims at supporting private equity fund managers that have shown a strong track record of delivering returns to the investors.

The FoF also gives an opportunity to the global institutional investors for building a portfolio of growth-focused funds in India as well as selectively co-invest into a wide range of investment opportunities.

The investment made by FoF is in a variety of sectors, including social infrastructure, green energy, consumer services, mid-income and affordable housing, technology, financial services, and others.

Commitments made by FoF:

As of date, FoF has made commitments to four funds which aggregate to over Rs. 2,750 crores (around USD 370 million).

These four funds are focused on middle-income and affordable housing; green energy and climate; affordable healthcare and entrepreneur-driven mid-market growth companies.

The managers of the four funds have successfully raised over USD 1.1 billion which is equivalent alongside NIIF’s commitments.

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