In the last two months, twelve companies received approval from the market regulator Securities and Exchange Board of India (Sebi) for setting up Alternative Investment Funds (AIFs).
Since October 10, the market regulator registered 12 AIFs that include India Realty Fund, Dar Mentorcap Film Fund, Capaleph Indian Millennium Small & Medium Enterprises Fund and Capaleph Indian Millennium Private Equity Fund.
AIFs are newly created class of pooled-in investment vehicles for real estate, private equity and hedge funds. Sebi had already allowed nine AIFs to set up shops in the country. As on August 31, 2012, a total of 20 applications were pending with Sebi for registration as AIFs.
The regulator had notified in May this year the guidelines for a new class of market intermediaries named AIFs, which are basically funds established or incorporated in India for the purpose of pooling in of capital from Indian and foreign investors for investing as per a pre-decided policy.
Sebi in August decided that the promoters of listed companies can offload 10 per cent of equity to AIFs such as such as SME Funds, Infrastructure Funds, PE funds and Venture Capital Funds registered with the market regulator to attain minimum 25 per cent public holding.
Under Sebi guidelines, AIFs can operate broadly in three categories. The Sebi rules apply to all AIFs, including those operating as private equity funds, real estate funds and hedge funds, among others.
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