Wrapper

An Indian AIF's PPM is drafted to SEBI's template and to Indian private placement law. Take that same document to an investor in Singapore or the Gulf and it is now an offer of securities in someone else's jurisdiction, under someone else's private placement rules.

The answer is not to rewrite the PPM. It is to bolt a wrapper onto it: a supplement attached to the placement memorandum of the domestic fund when it is distributed at offshore locations, which achieves compliance with the requirements for private placement of the securities of an offshore fund to investors in jurisdictions outside India.

One fund, one PPM, and a different wrapper for each jurisdiction the fund is marketed in.

The wrapper belongs to the unified structure. There, commitments from both domestic and offshore investors are pooled into a domestic pooling vehicle — an onshore AIF — so the India-based team earns management fee and performance fee for the entire structure at the onshore fund level. Foreign money reaches the onshore AIF through the automatic route under the FDI policy, with no approval needed from the Ministry of Finance or the RBI for FPIs to invest in a unified structure.

That efficiency has a distribution consequence. Because there is only one pooling vehicle and one offering document, the document itself has to travel. The offshore feeder is being offered interests in a vehicle whose disclosure was built for India, and the local regulator in the investor's jurisdiction has its own private placement conditions — who may be solicited, what warnings must appear, what may not be said. The wrapper carries those, and leaves the commercial terms of the fund untouched.

It is worth seeing what a wrapper is not. It is not a feeder fund, which is a separate constitution pooling offshore contributions in a foreign jurisdiction so that Indian tax compliance sits at feeder level rather than at each investor. It is not a parallel fund, which invests directly into Indian investee companies alongside the AIF. The wrapper is paper, not a vehicle.

Nilgiri India Growth Fund II is a Category II AIF with a target corpus of Rs 900 crore, structured as a unified fund. Of that, Rs 620 crore is expected from Indian family offices and institutions, and Rs 280 crore from offshore investors who will come in through a Singapore feeder.

The manager files one PPM with SEBI through a merchant banker. For the offshore raise, its counsel prepares three wrappers — Singapore, the UAE and the United Kingdom — each attached to the same PPM and each carrying that jurisdiction's selling restrictions and prescribed warnings.

Against a Rs 900 crore corpus that is roughly 12 basis points, and it forms part of the fund's set-up cost, charged to investors as a percentage of commitments and amortised from first closing.

The alternative — a separately drafted offering document in each of the three jurisdictions — buys nothing extra. The terms of the fund are identical for all three sets of investors, because they are all subscribing to the same onshore vehicle. Only the selling restrictions differ, and a wrapper is precisely the right size for a difference that small.

Chapter 13 (Legal Documentation and Negotiations), section 13.6, defines it in a single paragraph, and Chapter 8 supplies the unified structure the definition points at. This is a definitional question: what a wrapper is, and which structure it belongs to. The phrase to hold on to is 'supplement attached to the PPM of the domestic fund distributed at offshore locations'.

• It is a supplement, not a second PPM. The Indian PPM remains the offering document; the wrapper rides on it.
• It changes selling restrictions, not fund terms. An offshore investor and a domestic investor in a unified structure buy the same economics.
• It belongs to the unified structure — one domestic pooling vehicle taking both domestic and offshore money.
• It is not a feeder fund. A feeder is a separate pooling vehicle in a foreign jurisdiction; a wrapper is paper attached to a document.
• It does not displace SEBI's PPM template, and it does not remove the merchant banker filing.
• Jurisdiction count drives cost: one wrapper per jurisdiction marketed in, not one per investor.