ICICI Bank, US firm Apollo Global to end joint venture AION Capital

ICICI Bank's private equity arm-ICICI ventures and US-based Apollo Global Management Inc. are going to end their nine-year joint venture (JV) investment platform, AION Capital Partners Ltd. The two firms plan to make investments separately. Apollo Global is planning to start its own credit investment business in India.

The New York-based alternative investment manager is mulling to stop putting new money into AION Capital Partners and get out of its existing investments over the next few years, Bloomberg quoted people familiar with the matter. The two firms had started AION Capital in 2011 and mobilised capital worth $825 million for their first fund.

The JV has assets under management of $660 million as of March 31, offering a net internal rate of return of 5%, according to filings. Since the two firms' exclusive partnership has matured, they have agreed to change their relationship from April 1, the news agency quoted a representative of ICICI as saying in a statement.

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It added that Apollo will continue to advise on AION investments until the end of the fund's term, but, both firms are free to pursue other business opportunities independently.

The US firm will continue to look for private equity, real estate, and credit opportunities in India, a representative for Apollo told the news agency.

The firm will invest in the country (India) from several pools, comprising its global flagship fund, where it can be "the most effective and opportunistic" and partner with "the largest groups in the country", Apollo said in a statement as cited by the news agency.

Meanwhile, starting a credit business could put the US asset manager in direct competition with ICICI Bank and several other domestic lenders, which help companies with their debts.

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The news agency reported this week that India is mulling a new category of an alternative investment fund, which will zero in on acquiring stressed assets directly from banks and NBFCs (non-banking financial companies).

The AION platform has made several substantial investments in India, such as the takeover of GE Capital's commercial lending and leasing business in India, acquisition of bankrupt steelmaker Monnet Ispat and Energy in partnership with the JSW group via the Insolvency and Bankruptcy Code (IBC) process.