Private Equity India Art Fund

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Private Equity India Art Fund

  1. 1. METRIC INDIA ART FUND METRIC GLOBAL INDIAN MULTINATIONAL MAPPING VALUE GLOBALLY !! GROUP 4
  2. 2. Contents <ul><li>METRIC Global </li></ul><ul><li>Objectives </li></ul><ul><li>Investment Considerations </li></ul><ul><li>Investment Paradigm </li></ul><ul><li>Art Market - Destination </li></ul><ul><li>Investment Theme </li></ul><ul><li>Investment Allocation </li></ul><ul><li>Investment Criteria </li></ul>MAPPING VALUE GLOBALLY !!
  3. 3. METRIC GLOBAL <ul><li>Is a fast growing Investment advisory and Boutique Private Equity group </li></ul><ul><li>It was started in 2004 by four SPJCM Grads </li></ul><ul><li>Operates from 5 Locations: </li></ul><ul><li>Mumbai, Singapore, Dubai, Shanghai, New York </li></ul><ul><li>Current Assets under Management US $500 million </li></ul><ul><li>Current Funds are divided into three family of Funds: </li></ul><ul><li>METRIC India Real Estate Fund – US $175 million </li></ul><ul><li>METRIC BRIC Special Situation Fund – US $150 million </li></ul><ul><li>METRIC Emerging Market Alternate Asset Fund – US $125 million </li></ul>MAPPING VALUE GLOBALLY !!
  4. 4. METRIC INDIA ART FUND (MIAF): OBJECTIVE <ul><li>The fund aims to build & finance the Art Industry as a whole </li></ul><ul><li>Investment in publicly traded companies associated with the Industry </li></ul><ul><li>Investment in Museums, Art Galleries & Private assets promising high growth </li></ul><ul><li>Primary objective is to bring transparency in the Investments in ART </li></ul><ul><li>Bridging the Gap of Financial markets & Art as an asset class </li></ul><ul><li>It would operate both as investor in works of Art </li></ul><ul><li>And as a Structured Fund Manager investing in the Sector </li></ul><ul><li>Emphasis would be to take the advantage of the untapped Art market </li></ul>MAPPING VALUE GLOBALLY !!
  5. 5. INVESTMENT CONSIDERATIONS <ul><li>The investment of significant levels of new money in the global art market results in a preparing ground for businesses that serve stakeholders, art investment, and promotion processes worldwide </li></ul><ul><li>Existing non-artisan corporate players have the first mover advantage as they shape and develop the emerging Art Industry </li></ul><ul><li>The economic benefits from value appreciation are distributed in favor of intermediaries and other art businesses (and thus tend to be limited for artists and art buyers) </li></ul><ul><li>Globalization of the Art Industry is inevitable and is fuelled by ease of transport / spread of artistic concepts, global nature of all industries serving high net worth individuals (consuming the best rather than local) and lack of regulation around the world </li></ul><ul><li>However, the existing presence of art market is mainly reflected today in the auction and art fair segments of the art industry, leaving significant opportunity for further consolidation </li></ul>MAPPING VALUE GLOBALLY !!
  6. 6. INVESTMENT PARADIGM <ul><li>Creating, collecting & investing in art is an increasingly global activity with open access </li></ul><ul><li>Significant returns from Art assets have spurred Art Investments as a separate asset class in the Portfolio </li></ul><ul><li>Rapid emerging business in high growth segment of the global economy </li></ul><ul><li>The business is also serviced by other business like media, IT, Finance, Manufacturing, Specialty Retail, Logistics and Security together forming ‘Art Industry’ </li></ul><ul><li>Emergence of Art houses, galleries, & Auction houses have bought transparency in the deal size. </li></ul>MAPPING VALUE GLOBALLY !!
  7. 7. The Art Market………Next Destination <ul><li>In 2006, the assets of HNI’s grew by 11.4% to USD 37.2 trillion, showing the first double-digit growth in seven years </li></ul><ul><li>The number of HNI’s in the world increased by 8.3% to 9.5 million, and the number of ultra-HNI’s grew by 11.3% to 94,970. The largest growth of HNI population occurred in </li></ul><ul><li>Singapore(21.2%) </li></ul><ul><li>India (20.5%) </li></ul><ul><li>Russia (15.5%) </li></ul><ul><li>the Middle East (11.9%) </li></ul><ul><li>Latin America (10.2%) </li></ul><ul><li>China (7.8%). </li></ul><ul><li>( Merrill Lynch / Capgemini World Wealth Report 2007 ) </li></ul>MAPPING VALUE GLOBALLY !! <ul><li>Requirements of Different Asset classes for Portfolio Diversification </li></ul><ul><li>BRIC countries are becoming more active in the Art market thus providing more liquidity in the sector </li></ul><ul><li>Increase disposable income in the hands of people to economic boom can be leveraged upon. </li></ul>
  8. 8. METRIC INDIA ART FUND (MIAF) INVESTMENT THEME MAPPING VALUE GLOBALLY !! <ul><li>Private Equity – 60% </li></ul><ul><li>High Growth Assets </li></ul><ul><li>Personal Arts </li></ul><ul><li>Auction Houses </li></ul><ul><li>Art Galleries </li></ul><ul><li>Historical Monuments </li></ul><ul><li>Public Equity – 30% </li></ul><ul><li>Equity Listed in Bourses </li></ul><ul><li>Ancillary Businesses </li></ul><ul><li>Liquid Funds – 10% </li></ul><ul><li>Treasury Bonds </li></ul><ul><li>Liquid Funds </li></ul><ul><li>Term Funds </li></ul>
  9. 9. From Investing in Art Investment in Art Industry
  10. 10. Art Industry – Private Equity MAPPING VALUE GLOBALLY !! <ul><li>Art Magazines </li></ul><ul><li>Event Management firms </li></ul><ul><li>Value services firms </li></ul><ul><li>Media Channels </li></ul>Media <ul><li>Security Services </li></ul><ul><li>Software IT (Art oriented </li></ul><ul><li>Supply Chain Management </li></ul><ul><li>Financial Services </li></ul>Services <ul><li>Auction Houses </li></ul><ul><li>Museums </li></ul><ul><li>Galleries </li></ul><ul><li>Online Stores </li></ul><ul><li>Specialty Stores </li></ul>Business
  11. 11. Investment Criteria <ul><li>Proven business model, scale-up potential </li></ul><ul><li>With strong international expansion potential </li></ul><ul><li>Significant and quantifiable barriers to entry </li></ul><ul><li>Strong management team and a clear path of succession, including retention of exiting owners at the board level in active and clear management strategies </li></ul><ul><li>Customary protection of minority shareholders rights, right of first refusal, drag along, tag along and other customary provisions </li></ul><ul><li>Active board participation granted to METRIC Team, ongoing assistance with finance, M&A, international business development and investor relations functions </li></ul><ul><li>Clear exit strategy over 5-year time horizon, including more than one option and allowing for over 25% in annualized IRR </li></ul><ul><li>Deal size in excess of INR 1 million; for deals above USD 20 million in size co-investors would be invited </li></ul>MAPPING VALUE GLOBALLY !!
  12. 12. Investment Criteria – Segment Wise MAPPING VALUE GLOBALLY !! <ul><li>Art Magazines </li></ul><ul><li>Event Management firms </li></ul><ul><li>Value services firms </li></ul><ul><li>Media Channels </li></ul>Media <ul><li>Security Services </li></ul><ul><li>Software IT (Art oriented </li></ul><ul><li>Supply Chain Management </li></ul><ul><li>Financial Services </li></ul>Services <ul><li>Auction Houses </li></ul><ul><li>Museums </li></ul><ul><li>Galleries </li></ul><ul><li>Online Stores </li></ul><ul><li>Specialty Stores </li></ul>Business <ul><li>Development Stage </li></ul><ul><li>Min net worth of INR 10 mn </li></ul><ul><li>Management Dependent </li></ul><ul><li>Metros (MUM & DEL) </li></ul><ul><li>Later Stage companies </li></ul><ul><li>Broader resource of Product </li></ul><ul><li>Technologically upgraded </li></ul><ul><li>3-5 years of Track record </li></ul><ul><li>Later Stage companies </li></ul><ul><li>Scalable Business Model </li></ul><ul><li>Improving Cash flows </li></ul><ul><li>4-5 years of track record </li></ul><ul><li>International expansion </li></ul>
  13. 13. MAPPING VALUE GLOBALLY !!
  14. 14. MAPPING VALUE GLOBALLY !!
  15. 15. MAPPING VALUE GLOBALLY !!
  16. 16. MAPPING VALUE GLOBALLY !!

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