Future tense for INDUS hospitality fund

Lehman Brothers’ collapse has put a question mark over Future Group’s $200 million hospitality fund in which the failed US investment bank had invested $80-100 million. With Lehman filing for bankruptcy, Future group is uncertain about the status of the Wall Street firm’s investment.

Future Capital had closed Indus Hospitality fund three months ago and expected to start deploying funds by the end of this year. A senior executive at Future Capital said: “It’s early days yet. We do not know for sure if some other company will buy this investment or it will be recalled.” He said there has been no change of plan on deployment of the fund so far.

The fund managers have identified two hotel projects in which they expect to make investments in the next couple of months, by when there could be further clarity on Lehman’s position.

Indus Fund’s mandate is to invest in around 15 three and four star hotels across the country. The fund aims to have controlling stake in all these ventures. Future Group has also been looking at building hotels in its own malls, especially budget hotels. Click for entire post from The Economic Times