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SEBI tells new PE and venture capital funds to keep it simple

The Securities & Exchange Board of India (‘SEBI’) has asked several PE and VC applicants to “confirm whether any provision in the private placement memorandum (PPM) is with respect to activity/operations of innovative nature, i.e. not commonly practised by the AIF industry.”Alternative Investment Funds now have to specifically declare whether any clause or section in private placement memorandum affects the blind pooling requirement. Private equity (PE) and venture capital funds opening shops in India are being told by the capital market regulator to stay away from ‘innovative structures’, lending, and tampering with existing arrangements to accommodate select big-ticket investors.

Source: Economic Times

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