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Religare to invest USD1bn in asset management businesses

Religare Enterprises, a financial services group focusing on emerging markets, has approved a commitment of up to USD1bn for investments in asset management businesses.

The board has approved an initial investment in Northgate Capital, a private equity and venture capital firm with principal offices in the San Francisco Bay Area and London.

The parties have signed a definitive agreement for Religare to acquire a majority equity interest in Northgate’s management company. Northgate’s five partners will continue to retain controlling interests in Northgate’s general partner entities and will also maintain a significant equity stake in the management company. In addition, there will be no changes to Northgate’s management team, investment staff, or day-to-day operations, investment committee and investment processes as a result of the partnership with Religare.

The transaction is subject to customary closing conditions and regulatory approvals and is expected to close in the first half of 2010.

Sunil Godhwani (pictured), chief executive and managing director of Religare Enterprises, says: "We are very excited about this opportunity to partner with Northgate as we expand our global asset management footprint. Northgate’s seasoned management team, proven investment approach and strong track record in generating returns for a sophisticated and diversified client base make them an ideal fit for us. This partnership will accelerate our process of seeking similar partnerships in other asset classes, including both alternatives and traditional in developed and emerging markets."

Hosein Khajeh-Hosseiny, partner and head of global private equity at Northgate, adds: "Our strategic partnership with Religare completes our search for a principled and distinctive industrial and capital markets partner in the emerging world. Religare will uniquely strengthen our industrial and capital markets insights and solidify our presence, access, and investment due diligence in the emerging markets, especially Asia. We are especially pleased with the opportunity to tap into the insights and networks of a group that shares our commitment to distinctive research and insights, innovation and teamwork."

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