US hedge fund to aid India, China in overseas acquisitions

By SiliconIndia   |   Thursday, 22 February 2007, 06:00 Hrs
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TOKYO: After the successful takeover bids by Tata and Hindalco, India Inc seems poised for an extended bullrun. According to latest reports, US hedge fund Cerberus is exploring opportunities to help fast-growing Chinese and Indian firms make acquisitions abroad, said its chairman, former US Treasury Secretary John Snow.

“Over time we hope to have a good footprint in India and China, probably China first,” Snow said in an interview with a news agency. Snow has visited China in recent weeks and also plans to travel to India later this year.

The value of Asia Pacific companies acquiring US firms is already running at $7.3 billion, nearly neck-and-neck with the 2006 total of 7.6 billion, and up from a recent low of $1.1 billion in 2003, according to data providers at Thomson Financial.

“In the case of investments in the United States, we would bring a real understanding and sensitivity to the process. We know the rules of that game that could help co-investors avoid legal barriers,” said Snow, who plans to visit Asia three or four times a year.Cerberus hopes to compete with other funds eager to invest in China by aligning its interests with those of the Chinese government.

Many players in alternative investment fear that too much capital is chasing too few deals, artificially inflating prices and creating a bubble. Snow noted that Cerberus can invest in anything from auto financing to housing, so it will be well placed when the bubble bursts.

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