Proposed EGM and Trading Update

    RNS Number : 7638J
  KSK Emerging India Energy Fund Ltd
  09 December 2008
   

    Not for release, publication or distribution in, or into, the United States, Canada, Australia, Japan, Israel, the Republic of Ireland
or the Republic of South Africa.

 Press Release   9 December 2008

    
    KSK Emerging India Energy Fund Limited
    ("KEF" or "the Company")
    Proposed Extraordinary General Meeting and Trading Update

    The Company today announces proposals to be put forward at an extraordinary general meeting ("EGM") together with a trading update.

    Since the Company's IPO in June 2008 the global financial crisis has materially affected the investment landscape in India. This
backdrop has presented KEF's Investment Manager with new investment opportunities and a basis upon which to renegotiate more favourable
terms with pipeline target companies, including those set out in the Company's admission document.

    Although the events described above have caused a delay in the deployment of KEF's funds, the Board believes that the resultant
preservation of capital to date has been in the best interests of shareholders and that the Company remains in a strong position to exploit
attractive entry valuations in an increasingly capital constrained market.  

    As at 30 November 2008 the estimated unaudited Net Asset Value per share was 99.5 pence of which 93.8 pence represents cash deposits.

    EGM Proposals

    Following consultation with shareholders the Board is aware of a number of investors who, predominantly due to internal issues within
their own funds, wish to realise part or all of their investment in KEF at close to net asset value per share and who are unable to do so
because of illiquidity in the Company's shares. The Board is equally aware of a number of investors who are supportive of the Company in the
long term. 

    The Board therefore intends to put forward the following proposals to shareholders at an EGM to be convened in January 2009:

    Proposal One

    An ordinary resolution to authorise the Company to carry out a tender offer ("Tender Offer") for up to 50 per cent. of the Company's
issued share capital (excluding shares held in treasury) at a price of 90 pence per share. Shareholders would be invited to tender all or
part of their shares at any time up to the date the Tender Offer closes (expected to be early February). Shareholders who do not wish to
tender their shares will not be required to take any action.

    If the Tender Offer is taken up in full, the Board and the Company's Investment Manager believe that despite a smaller pool of capital
available for investment, the Company will remain in a position to generate long term capital growth for shareholders through diversified
exposure to an actively managed portfolio of investments in companies engaged in the Indian power and energy sector value chain. 

    Proposal Two

    A special resolution to appoint a liquidator to wind up the Company's affairs, realise its investments, discharge its liabilities and
return surplus capital to shareholders. The Board provisionally estimates that liquidation costs (excluding any potential loss on
realisation of invested assets) would amount to approximately 1.5 pence per share.  Although a significant percentage of the Company's
assets are held in cash, the Board cannot be certain as to the timing of a cash distribution to shareholders, or that the Company's invested
assets could be realised quickly or at a price close to that which the Company paid at investment. 

    If Proposal Two is passed then the Tender Offer will not proceed and the Company will be wound up. If neither Proposal One nor Proposal
Two are passed the Company will continue as currently constituted. 

    A circular and notice of EGM giving further details of the above proposals will be sent to shareholders shortly.

    Trading Update

    In addition to KEF's �4.3 million investment in Konaseema Gas Power Limited (as announced on 17 July 2008) the Company has acquired
776,527 ordinary shares in Diamond Power Infrastructure Limited ("DPIL") for INR 82.3 million (approximately �1.1 million) which represents
approximately 4 per cent. of the issued share capital of DPIL. The Company has contracted to acquire a further investment of up to 3.5 per
cent of the issued share capital of DPIL. 

    DPIL is one of India's emerging leaders in manufacturing equipment required in the transmission and distribution of power including
conductors, cables and transformers. Distribution business is expected to grow rapidly in India due to Indian Government initiatives
designed to strengthen the networks across urban and rural areas as enshrined in the commitment to provide 'Power for All by 2012'.

    DPIL undertakes turnkey services including project initiation, planning, design and development, procurement and commissioning.  DPIL is
currently executing a major expansion plan across all of its product lines which will make it one of the top five manufacturers of this
equipment in India.

    DPIL revenues for the year ending 31 March 2008 were INR 5,503 million (approximately �77.5 million), and profit after tax was INR 456
million (�6.4 million) for the same period. Gross assets as at 31 March 2008 were INR 3,014 million (�42 million).  DPIL is quoted on the
Bombay Stock Exchange (DIAC:BSE).

    On 9 October 2008 the Company announced it was in negotiations with Athena Infraprojects Private Limited regarding a possible investment
of approximately US$50 million. In light of current global economic conditions, the Investment Manager sought to renegotiate terms however a
satisfactory agreement could not be reached and these negotiations have now been terminated. 

    The Company's Investment Manager is actively pursuing a number of other proposed transactions comprising both new opportunities and
renegotiated deals and, pending the outcome of the EGM, the Company will update shareholders in due course.

    - ENDS -
    For further information:
 KSK Emerging India Energy Fund Limited
 Tanmay Das, Non-Executive Director      Tel: +44 (0) 20 7398 7715
                                              www.ksk-eiefund.com 

 Liberum Capital Limited
 (Financial Adviser and Broker)
 Steve Pearce                     Tel: +44 (0) 20 3100 2224
 steve.pearce@liberumcapital.com     www.liberumcapital.com

 Grant Thornton UK LLP
 (Nominated Adviser)
 Philip Secrett             Tel: +44 (0) 20 7728 2578
 philip.j.secrett@gtuk.com               www.gtuk.com

    Media enquiries:
 Abchurch Communications Limited
 Nick Probert / Henry Harrison-Topham  Tel: +44 (0) 20 7398 7715
 nick.probert@abchurch-group.com          www.abchurch-group.com

    Disclaimer
    This press release is not for distribution (directly or indirectly) in or to the United States, Canada, Australia, Japan, Israel, the
Republic of Ireland or the Republic of South Africa or any other jurisdiction in which the same would be unlawful. This press release is not
an offer of securities for sale in or into the United States, Canada, Australia, Japan, Israel, the Republic of Ireland or the Republic of
South Africa. This press release does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any
offer to purchase or subscribe for, any Ordinary Shares of the Fund.

    The Company is a Registered Closed-ended Investment Fund pursuant to the framework introduced by the guidance document issued by the
Guernsey Financial Services Commission (the "GFSC") dated February 2007. Shares may not be offered directly to the public within Guernsey,
such public being defined in the Guidance Document as being any person not regulated under any of Guernsey's financial services regulatory
laws. Neither the GFSC nor the States of Guernsey Policy Council take any responsibility for the financial soundness of the Company or for
the correctness of any of the statements made or opinions expressed with regard to it.

This information is provided by RNS
The company news service from the London Stock Exchange
 
  END 
 
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