US investment firm Warburg Pincus names Indian as new Asia private equity head

Vishal Mahadevia PHOTO: @warburgpincus

HONG KONG (Reuters) – Private equity firm Warburg Pincus on Monday named its India chief Vishal Mahadevia as head of Asia private equity, a newly created position, while veteran China head Frank Wei will step down amid an Asia-wide reshuffle at the U.S. investment firm.

Mahadevia, a 17-year veteran of the firm, will remain as co-head of financial services as part of the changes in a region which accounts for about a third of its more than $84 billion of assets under management and where it is appointing new leaders for main markets including China and India, Warburg said.

“Investors are looking for balance and diversification across the region,” Warburg President Jeffrey Perlman said in an interview. “As we look at our continued push across Asia Pacific, it’s really bringing a regional approach and a regional mindset to that effort.”

In China, Wei, who has worked at Warburg for over two decades, would step down from his current role but would remain as a managing director through 2024 to ensure a “seamless transition”, the Warburg statement said.

Partners Min Fang and Ben Zhou, who joined the firm in 2007 and 2005, respectively, would become co-heads of China private equity to lead investments in a country where it has had a presence for nearly 30 years.

“China is a very important market for us as a firm,” Perlman said. “What most (investors) acknowledge is that it’s very hard to ignore a $18 trillion market, which is really the scale that China has reached today.”

The moves come as Warburg is nearing completion of raising its 3 billion yuan ($420.5 million) maiden yuan-denominated fund, which will focus on the healthcare sector, a person with knowledge of the matter said.

Warburg declined to comment.

Shanghai-based partner Jericho Zhang, who focused on the consumer sector, and another four China dealmakers had recently left the firm, adding to seven other departures last year mostly from its consumer or internet investment teams, two other people with knowledge of the matter said.

A Warburg spokesperson said the firm was “making some modest changes to the structure and size of our team, to better support the opportunities in the region.”

Asia-focused fundraising totalled $73 billion as of Nov 21, nearly half of 2022’s annual amount and less than a third of the $299 billion raised in 2021, Preqin data shows.

Expectations that the Fed is done with the bulk of its rate hikes have led to a rebound in startup investments, but worries about a potential downturn in the near future are still weighing on sentiment.

The U.S. investment heavyweight last month said it had raised $17.3 billion for its latest global flagship private equity fund, the largest in its nearly 60-year history.

Warburg raised a $4.25 billion private equity fund focusing on China and Southeast Asia in 2019, its second such fund.

When asked if Warburg plans to raise a pan-Asia fund going forward, Perlman said the successor vehicle to the current fund would open up possibilities for other markets in the region.

With Mahadevia’s promotion, Narendra Ostawal, a 16-year veteran, has been appointed head of India private equity.

In Singapore, Saurabh Agarwal who has been at the firm since 2009, has been named head of Southeast Asia private equity.

Warburg also said that Takashi Murata, a former Goldman Sachs veteran, will be joining in early 2024 as head of Japan and co-Head of Asia real estate, alongside Ellen Ng.

The firm, whose portfolio spans more than 250 companies, plans to open its Japan office next year, led by Takashi, as it seeks to bolster its business in developed markets and beef up its real restate and private equity investments in Japan, one of the sources said.

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