NEW DELHI (Reuters) - The UK business of Indian tour operator Cox & Kings Ltd
Prometheon Holdings will use the money to retire debt that it raised when it bought British specialist travel company Holidaybreak last July, in the biggest overseas deal by an Indian company in the sector.
"We expect Holidaybreak to benefit from synergies arising from its association with Cox and Kings," said Sunil Nair, Citi Venture Capital International's managing partner for India, Europe, Middle East and Africa, in a statement.
Cox and King shares closed 5.42 percent higher at 147.80 rupees in a weak Mumbai market after earlier gaining as much as 8.2 percent following the announcement.
The deal comes at a time when private equity investments in Indian companies are down, with a drop of almost 40 percent to $3.81 billion in the first half of this year, according to VCCircle.com, an industry tracker.
Returns on funds raised in dollars have shrunk with the rupee's tumble to record lows, compounding the effects of a weak stock market.
Travel and consumer businesses have been a bright spot, however.
Earlier this year, Fairfax Financial Holdings bought Thomas Cook's Indian unit for about $150 million, in a deal that saw interest from top private equity funds including the Blackstone Group
Cox and Kings, the parent of UK-based unlisted Cox and Kings, gets around half its revenue from its international operations and has been looking at overseas acquisitions to tap the booming outbound market and drive future earnings growth.
The company, which traces its roots back to the 18th century when it was established to cater to British forces, has operations in countries including Australia, the United States, Germany, Hong Kong, Greece and Singapore.
(Reporting by Anurag Kotoky; additional reporting by Indulal PM in MUMBAI; editing by Jane Baird)