Media company Bennett, Coleman & Co Ltd (BCCL) has picked up an undisclosed stake in an online hotel booking company TravelMasti. It provides internet-based travel related services to domestic and inbound tourists and corporates for their conferences.
TravelMasti's current business mix comprises domestic clients (60 per cent), inbound clients (25 per cent) and corporate conference clients (15 per cent). The site is available in five foreign languages too such as Spanish, French, Dutch, Italian, and Portugese, besides English.
Since BCCL hardly discloses their investments, it's not clear if it has a cash component or if it's an equity in return for advertising space and branding support.
BCCL had earlier picked up a 17 per cent stake in HolidayIQ, a Bangalore-based holiday information portal. HolidayIQ was angel funded by DS Puri (co-founder of HCL Group) and Erasmic Venture Fund.
Friday, August 31, 2007
Srei Infrastructure Finance Acquires 76% In AP Government Venture Fund
Srei Infrastructure Finance has acquired a 76 per cent stake in an Andhra Pradesh government promoted venture fund. Srei has picked up stake in Hyderabad Information Technology Venture Enterprises Ltd (HITVEL), a venture capital fund set up in 2000 by the Andhra Pradesh Development Corporation, the Andhra Pradesh Industrial Infrastructure Corporation and the Small Industries Development Bank of India. The financial terms of the deal are not known.
HITVEL's first fund had a corpus of Rs 15 crore ($3.6 million), and has invested about Rs 12 crore in seven IT companies from this fund. Its second fund had a corpus of Rs 50 crore ($12.5 million).This is the second instance of acquisition (or merger) of a venture fund in India. In May last year, WestBridge Capital Partners merged with Sequoia Capital to form Sequoia Capital India.
HITVEL's first fund had a corpus of Rs 15 crore ($3.6 million), and has invested about Rs 12 crore in seven IT companies from this fund. Its second fund had a corpus of Rs 50 crore ($12.5 million).This is the second instance of acquisition (or merger) of a venture fund in India. In May last year, WestBridge Capital Partners merged with Sequoia Capital to form Sequoia Capital India.
Infosys, Wipro in race to buy US analytics firm: report
Infosys Technologies and Wipro, India's second and third-biggest software firms, are competing to purchase a US analytics firm in a deal valued at up to 160 million dollars, a report said Friday.
The Bangalore-based firms have shown early interest in buying New Jersey-headquartered MarketRX -- the first time they are both targeting the same acquisition, the Economic Times cited unnamed sources as saying.
The eventual purchaser would be able to tap MarketRX's established and potentially lucrative practice in analytics, including people trained in diverse branches such as mathematics, statistics and accountancy.
Read more in The DNA Money article.
India enters global market-cap Top 10
The Indian capital market's record-breaking spree continues. Shortly after crossing the $1-trillion mark in total market capitalisation, it has now broken into the Top 10 list - with a total m-cap of $1.09 trillion. India is now the 10th largest equity market in the world. In the last one month, it has overtaken Russia, Australia, South Korea and Italy. Interestingly, the rise in India comes when these markets have fallen more on account of the ongoing sub prime crisis.
Echoing many analysts, a fund manager said that India is relatively better placed even in the midst of the sub-prime crisis. India lost just 0.6% of its market capitalisation during the month ending August 29, 2007. The Russian market lost the maximum of 24%, dipping from $1.12 trillion to $848 billion; the other three lost 6% or less, managing to stay above the $1- trillion mark.
The US, from where the subprime pandemic spread, is sitting pretty on the top of the heap. American companies managed to add 0.7% to their market cap when markets where falling elsewhere. China (17%) and Hong Kong (0.5%) were the only other markets in the Top 10 list to have gained in m-cap.
Sun buys 48.9% stake in Red FM
South Asia FM Ltd, a unit of Kalanidhi Maran’s Sun TV Network, today said it would acquire 48.9 per cent equity in radio channel Red FM, sending the Sun TV stock up nearly 6 per cent by the close of trade today on the Bombay Stock Exchange.
The promoters of Red FM – Usha Reddy, Arjun Rao and Prannoy Roy’s New Delhi Television – will hold the remaining stake. They have also got 35 per cent of the enlarged equity of South Asia FM through an investment company A H Multisoft and NDTV News.It is not clear yet whether, apart from the equity swap, any money is changing hands.
According to a joint study of Federation of Indian Chambers of Commerce & Industry, an industry body, and PricewaterhouseCoopers, the consultancy, the size of the radio broadcasting industry will expand from Rs 500 crore to Rs 1,700 crore by 2011 – a compounded annual growth rate of 28 per cent.
NDTV, Hyderabad-based Value Labs and Malaysia’s Astro All Asia Networks had acquired Red FM from Radio Today, a unit of Living Media, which owns India Today magazine, for about Rs 130 crore last year.Under the broadcasting norms, this is the maximum that Sun TV can acquire in Red FM for the moment.
With this deal, Sun TV, which has radio licences for 23 locations, none in the metros, and operates two radio stations, one each in Jaipur and Bhubaneswar, will get a foothold in the north, west and east of the country. Red FM is on air in the lucrative markets of Mumbai, Delhi and Kolkata.
Wadias may buy out Danone at discount
The Wadias of Bombay Dyeing are poised to buy the entire stake of partner Groupe Danone in biscuit maker Britannia at a discount.The contours of the deal are likely to be drawn up at a meeting on September 3. That is also the time when Danone Chairman Franck Riboud is expected to be in India.
Sources close to the deal said the French dairy foods giant’s exit would be in line with that of other multinational companies from joint ventures in India and the discount in this case could be as much as 20 per cent to the market price.Danone is keen on operating on its own in India and needs a no-objection from the Wadias to be able to do so.
The Wadias and Danone hold 50 per cent equity each in Associated Biscuits International (ABIL), which holds 51 per cent equity in Britannia, giving each partner control over 25.1 per cent equity of the joint venture.
Read more in The Business Standard article.
OIL allowed to sell 10% through IPO
The government has approved Oil India Ltd’s (OIL) proposal for 10% fresh equity issue through an initial public offer (IPO) along with disinvestment of 10% equity in favour of public sector oil marketing companies.
OIL is expected to raise around Rs 1,425 crore through the IPO at a price of Rs 600 per share. The move will enable the company to get listed on the stock exchanges.
The public sector company will also offer 1% stake to its employees, finance minister P Chidambaram said after the Cabinet Committee of Economic Affairs (CCEA) meeting.The divestment of 10% of OIL’s paid up capital in favour of IOC, HPCL and BPCL would be done in the ratio of 2:1:1 respectively.
The fresh issue of 10% of its paid up capital would meet Sebi’s requirement of listing of the company’s share on the stock exchanges. This would not only make OIL more amenable to market discipline but would also boost the company’s image. Besides, it would help OIL to raise resources for its future expansion and growth. The additional 1% allocation for its employees would motivate them towards better performance, it added.
OIL is 98.13% owned by the government and the remainder by employees. The proposed IPO of the company is aimed at financing the expansion and investment projects totalling about $ 3.5 billion over the next five years. The investments are proposed on expanding the exploration activities, including acquisitions overseas along with IOCL.
OIL is expected to raise around Rs 1,425 crore through the IPO at a price of Rs 600 per share. The move will enable the company to get listed on the stock exchanges.
The public sector company will also offer 1% stake to its employees, finance minister P Chidambaram said after the Cabinet Committee of Economic Affairs (CCEA) meeting.The divestment of 10% of OIL’s paid up capital in favour of IOC, HPCL and BPCL would be done in the ratio of 2:1:1 respectively.
The fresh issue of 10% of its paid up capital would meet Sebi’s requirement of listing of the company’s share on the stock exchanges. This would not only make OIL more amenable to market discipline but would also boost the company’s image. Besides, it would help OIL to raise resources for its future expansion and growth. The additional 1% allocation for its employees would motivate them towards better performance, it added.
OIL is 98.13% owned by the government and the remainder by employees. The proposed IPO of the company is aimed at financing the expansion and investment projects totalling about $ 3.5 billion over the next five years. The investments are proposed on expanding the exploration activities, including acquisitions overseas along with IOCL.
Thursday, August 30, 2007
Apollo acquires Zavata
Apollo Health Street, a global healthcare outsourcing arm of the Apollo group, on Thursday announced the acquisition of Atlanta-based BPO and enterprise support solutions company, Zavata Inc, for Rs 697 crore.
"The fourth acquisition for Apollo Health Street and the second in the US provider space, it strengthens AHS's position as a leading provider of outsourcing solutions to the healthcare industry," Apollo Chairman Prathap C Reddy said.
While the Bank of India and Barclays Capital had structured a debt to the tune of Rs.550 crore, the rest would be from internal generation for the acquisition, he said.
It also makes the combined organisation the largest focused healthcare BPO organisation in the country with a significant IT business, he said.The combined oganisation will have more than 100 customers and over 2,500 employees spread across multiple locations in the US and in India.The company was coming up with a back office at Chennai, which would employ 400 persons initially, which would go upto 2,000, he said.
Read more in The DNA Money article.
"The fourth acquisition for Apollo Health Street and the second in the US provider space, it strengthens AHS's position as a leading provider of outsourcing solutions to the healthcare industry," Apollo Chairman Prathap C Reddy said.
While the Bank of India and Barclays Capital had structured a debt to the tune of Rs.550 crore, the rest would be from internal generation for the acquisition, he said.
It also makes the combined organisation the largest focused healthcare BPO organisation in the country with a significant IT business, he said.The combined oganisation will have more than 100 customers and over 2,500 employees spread across multiple locations in the US and in India.The company was coming up with a back office at Chennai, which would employ 400 persons initially, which would go upto 2,000, he said.
Read more in The DNA Money article.
Nissan, Leyland in small truck alliance
The Chennai-based commercial vehicles maker and Japan’s Nissan Motor, in which France’s Renault is the single-largest shareholder, today agreed to form three joint ventures to develop, manufacture and market light commercial vehicles (LCVs). The joint venture will produce 100,000 vehicles annually in the medium term.
Renault already has a joint venture with utility vehicles maker Mahindra & Mahindra, which is rolling out the Logan sedan, and has announced another one with two-wheeler maker Bajaj Auto for a low-cost car.
The first of the three ventures will make Nissan commercial vehicles in India for the domestic market and overseas sales. Ashok Leyland will control a majority stake in the company.A venture for assembling engines and related parts is also on the cards. It will be controlled by Nissan.
The third company, equally owned by the two partners, will develop LCVs and engines, and market them in India and overseas. The products developed will be sold under both the Ashok Leyland and Nissan brands.
The two companies are also thinking of collaborating in sales and distribution. This may include giving Nissan an access to Ashok Leyland’s vast dealer network. Ashok Leyland may use Nissan’s dealer network in identifying export markets.Ashok Leyland expects to sign a final agreement with Nissan in October after completing a feasibility study.
Govt plans to divest NTPC stake; may raise up to Rs 6,000 cr
The government plans to divest 4.75 per cent of its stake in NTPC Ltd, the country's biggest power generation utility, through a public offer that could fetch it nearly Rs 6,000 crore.
Power Ministry, acting on a request from the state-run firm, has approached the Department of Disinvestment in Ministry of Finance for approval of a Follow on Public Offer (FPO) of 4.75 per cent shares, official sources said.
NTPC had a few years back proposed an initial public offering (IPO) of 24 per cent. But in February 2004, the government allowed NTPC to go for an IPO of 10 per cent of its paid-up capital in one or more stages to augment resources.
The company chose to go for an IPO of 5.25 per cent, leaving balance 4.75 per cent of approved IPO for later date. The IPO of 5.25 per cent was tagged with government divesting an equal shareholding. Subsequent to the offer, government shareholding in NTPC fell to 89.5 per cent from 100 per cent.
Sources said NTPC has stated that as a result of low level of free float, turnover of the shares of the company was quite low. Besides, for listing the company in National Stock Exchange's NIFTY and MSCI, it was required to have a free float of at least 12 per cent and 15 per cent respectively.
Power Ministry, acting on a request from the state-run firm, has approached the Department of Disinvestment in Ministry of Finance for approval of a Follow on Public Offer (FPO) of 4.75 per cent shares, official sources said.
NTPC had a few years back proposed an initial public offering (IPO) of 24 per cent. But in February 2004, the government allowed NTPC to go for an IPO of 10 per cent of its paid-up capital in one or more stages to augment resources.
The company chose to go for an IPO of 5.25 per cent, leaving balance 4.75 per cent of approved IPO for later date. The IPO of 5.25 per cent was tagged with government divesting an equal shareholding. Subsequent to the offer, government shareholding in NTPC fell to 89.5 per cent from 100 per cent.
Sources said NTPC has stated that as a result of low level of free float, turnover of the shares of the company was quite low. Besides, for listing the company in National Stock Exchange's NIFTY and MSCI, it was required to have a free float of at least 12 per cent and 15 per cent respectively.
Baer plans $250 mn hedge fund
Private equity player Baer Capital Partners plans to launch $ 250 million India-dedicated hedge fund by the year-end. Baer Capital is the first hedge fund to announce its India plans, after the recent proposal by the Securities and Exchange Board of India allowing direct entry of hedge funds.The fund is likely to be called Beacon India Growth Fund.
Baer Capital will have to register as a foreign institutional investor (FII).The fund will be investing in public (or listed) companies. It will be a long biased hedge fund using futures/derivatives to hedge itself against market decline. It will have more flexibility to stay in cash or take concentrated position and will be focused mainly on the mid-cap stocks across sectors.
The shareholders of Baer Capital Partners are the Fleming Family (10 per cent), Dubai Holding (15 per cent), founders Michael Baer, Alok Sama and Brij Raj Singh (together 50 per cent) and the balance by Shuaa Capital and CQS Management, London-based leading hedge fund company.
Read more in The Business Standard article.
Baer Capital will have to register as a foreign institutional investor (FII).The fund will be investing in public (or listed) companies. It will be a long biased hedge fund using futures/derivatives to hedge itself against market decline. It will have more flexibility to stay in cash or take concentrated position and will be focused mainly on the mid-cap stocks across sectors.
The shareholders of Baer Capital Partners are the Fleming Family (10 per cent), Dubai Holding (15 per cent), founders Michael Baer, Alok Sama and Brij Raj Singh (together 50 per cent) and the balance by Shuaa Capital and CQS Management, London-based leading hedge fund company.
Read more in The Business Standard article.
Firstsource acquires MedAssist for $330 mn
Mumbai-based Firstsource Solutions, a pure-play business process outsourcing provider, has acquired US-based MedAssist Holding for $330 million (Rs 1,353 crore).The deal is subject to regulatory approval under the US health services research (HSR) statute.It is the second-largest acquisition after Wipro bought out Infocrossing for about $600 million.
Firstsource has raised a debt of $275 million at 2.5-3 per cent above the LIBOR (London Inter-Banking Official Rate) for a five-year term. The balance $55 million will be paid through internal accruals. The company has a cash reserve of $80 million (around Rs 328 crore).
MedAssist is a debt-free company with a top line of $99 million. Its EBITDA margins are in the range of 22-24 per cent.
MedAssist, headquartered in Louisville, Kentucky has 1,400 employees and is a pan-American provider of revenue cycle management services to the healthcare industry. It has over 800 clients, including hospitals, large physician groups and alternate site providers.
Read more in The Business Standard article.
Realty consultant Richard Ellis buys India affiliate
CB Richard Ellis Group, headquartered in Los Angeles, has acquired majority interest in its India affiliate company CB Richard Ellis South Asia (popularly called CBRE India).The acqusition involves taking over services and operations in 30 Indian cities across the rapidly growing India realty market.
CBRE India has been an affiliate of CB Richard Ellis in India since 1994, and has executed more than 22 million square feet of leasing transactions and about 30 million square feet in project management assignments. The company also manages 40 million square feet of commercial properties and corporate facilities.
CBRE India has handled lease transactions for global companies including Goldman Sachs, Cisco Systems, McAfee and JPMorgan Chase and Hewlett-Packard.
CBRE India has been an affiliate of CB Richard Ellis in India since 1994, and has executed more than 22 million square feet of leasing transactions and about 30 million square feet in project management assignments. The company also manages 40 million square feet of commercial properties and corporate facilities.
CBRE India has handled lease transactions for global companies including Goldman Sachs, Cisco Systems, McAfee and JPMorgan Chase and Hewlett-Packard.
Wednesday, August 29, 2007
Mahesh Tutorials Lands $12 Million Funding From Helix Investments
This will be the second instance of institutional financing in the preparatory or tutorial business in India. Mumbai-based Mahesh Tutorials has landed $12 million investment from the Mauritius-based India-focused fund Helix Investments. Helix will pick up a 30 per cent stake in the company, MT Educare Pvt Ltd, which provides coaching for engineering and medical entrance tests, aptitude test preparation and vocational skills training. Helix has one board seat.
A few years ago, MBA admission test coaching company Career Launcher had received investment from Intel Capital, which was the first known investment by a venture capital fund in the business. Mahesh's will probably be the second.
Helix is an India-focused investment fund backed by members of the Cullman and Bloomingdale families of New York. David Danziger, Director, Helix Investments,said that the firm invested $12 million since it was impressed with the ‘‘future growth plans’’ of the company.
The funds will be used for national expansion and also to venture into newer areas like corporate training, according to Mahesh Shetty, founder and chairman of the company MT Educare Private Ltd. It currently has revenues of Rs 36 crore, which is expected to touch Rs 75 crore in the next financial year,. Polymath Advisors was the exclusive advisor for the transaction.
Helix has earlier invested in Goodlife Integrated Fitness Solutions, an India-based healthy prepared food delivery company doing business as Calorie Care, and OSi, a medical transcription outsourcing company.It's likely now more tutorial companies that have scalable business models could get funding. Kota-based Career Point is one such company, while Delhi-based FIITJEE also has revenues in the range of Rs 30-40 crore. It's a highly fragmented business, although cash rich.
A few years ago, MBA admission test coaching company Career Launcher had received investment from Intel Capital, which was the first known investment by a venture capital fund in the business. Mahesh's will probably be the second.
Helix is an India-focused investment fund backed by members of the Cullman and Bloomingdale families of New York. David Danziger, Director, Helix Investments,said that the firm invested $12 million since it was impressed with the ‘‘future growth plans’’ of the company.
The funds will be used for national expansion and also to venture into newer areas like corporate training, according to Mahesh Shetty, founder and chairman of the company MT Educare Private Ltd. It currently has revenues of Rs 36 crore, which is expected to touch Rs 75 crore in the next financial year,. Polymath Advisors was the exclusive advisor for the transaction.
Helix has earlier invested in Goodlife Integrated Fitness Solutions, an India-based healthy prepared food delivery company doing business as Calorie Care, and OSi, a medical transcription outsourcing company.It's likely now more tutorial companies that have scalable business models could get funding. Kota-based Career Point is one such company, while Delhi-based FIITJEE also has revenues in the range of Rs 30-40 crore. It's a highly fragmented business, although cash rich.
Firstsource to acquire MedAssist Holding Inc
Business process outsourcing service provider Firstsource Solutions has entered into an agreement to acquire US-based healthcare company MedAssist Holding, Inc for $330 million.
The deal is subject to regulatory approval under the US HSR (Hart-Scott-Rodino Anti Trust Improvements) Act.As per the terms of the agreement, there would be no change in the management of MedAssist and employees would continue in their current jobs, Firstsource said in a filing to the Bombay Stock Exchange.
MedAssist has 1,400 employees and is a provider of revenue cycle management services to the healthcare industry across America. This includes eligibility services, receivables management services and post-default collections services for healthcare providers.
Firstsource, which already has a presence in the US healthcare BPO space on the insurance company end, would now enter the hospitals segment of healthcare BPO services after the acquisition.MedAssist has over 1,000 clients. Its revenue for year ended 31 December 2006 was $99 million.
Read more in The Livemint article.
ASK Group mulls selling stake to foreign partner
With the aim to grow its business overseas, financial services provider ASK Group today said it is open to strategic alliances with a foreign partners having distribution and research capabilities and presence in the South-East Asian market.
ASK Group would also evaluate selling stake to the prospective partner either in the Group or in the specific businesses within the Group, depending upon the strength of the partner, said CEO Rajesh Saluja.
"Indications show there would be huge demand for services from the Indian clients to spread their investment in the emerging markets and South-East Asia in particular in the next 2-3 years. We want to tap that opportunity," Saluja said.
Declining to give further details, he said ASK has mandated investment banking firm Berkshire Hathaway to guide it on the stake sell.
"The proposed partner should bring technology, access to global market and help us to grow our business," Saluja said.
ASK Group is an un-listed firm in which Saluja has some stake along with the two promoters - Asit and Sameer Koticha.
Set up in 1983, the Group has emerged as a leader in the areas of portfolio management and investment advisory services on the back of a reasonably strong research infrastructure.
The company which caters to high net worth individuals (HNIs) having wealth over Rs one crore, intends to manage up to $4 billion in the next three years and has a revenue target of Rs 100 crore.
ASK Group would also evaluate selling stake to the prospective partner either in the Group or in the specific businesses within the Group, depending upon the strength of the partner, said CEO Rajesh Saluja.
"Indications show there would be huge demand for services from the Indian clients to spread their investment in the emerging markets and South-East Asia in particular in the next 2-3 years. We want to tap that opportunity," Saluja said.
Declining to give further details, he said ASK has mandated investment banking firm Berkshire Hathaway to guide it on the stake sell.
"The proposed partner should bring technology, access to global market and help us to grow our business," Saluja said.
ASK Group is an un-listed firm in which Saluja has some stake along with the two promoters - Asit and Sameer Koticha.
Set up in 1983, the Group has emerged as a leader in the areas of portfolio management and investment advisory services on the back of a reasonably strong research infrastructure.
The company which caters to high net worth individuals (HNIs) having wealth over Rs one crore, intends to manage up to $4 billion in the next three years and has a revenue target of Rs 100 crore.
BSE buys 5% in Calcutta Stock Exchange
Bombay Stock Exchange has purchased a five per cent stake in the Calcutta Stock Exchange, based in Kolkata, for Rs 60 crore as part of the corporatisation of the regional exchange.
Bombay Stock Exchange (BSE) bought the stake at Rs 2,000 a share, the exchange said in a statement issued late on Tuesday.
The CSE has been valued at Rs 1200 crore based on the BSE purchase value. Calcutta Stock Exchange is the second stock exchange, after BSE, to sell stake to investors as part of the corporatisation plan for stock exchanges.Earlier this year, BSE completed the corporatisation process by selling 51 per cent stake to various investors including Singapore Stock Exchange and Deutsche Boerse.
Private equity firms invest record $3.8 bn in India
Global private equity firms, including Blackstone and Carlyle Group, have made an investment of $3.8 billion in 2007 so far in the country, up 50 per cent from the year-ago period.
The record volume has been reached through 81 M&A deals. Last year, foreign private equity players had invested $2.6 billion, data complied by global consulting firm Dealogic showed.
Carlyle Group is the leading "financial sponsor" in India with investment of $777 million via two deals, including acquisition of over six per cent stake in HDFC.
It is followed by Dubai International Capital, which acquired a 2.87 per cent stake in ICICI Bank for $741 million, and Blackstone Group with $619 million inflow via eight deals.
Blackstone Group, the world's leading private equity firm, has acquired stake in companies such as Intelenet Global Services, Punj Lloyd and Gokaldas Exports.
The US-based Group has also decided to pump in $150 million to acquire a stake in Nagarjuna Construction Company. A move that comes close on the heels of its decision to acquire up to 70.1 per cent stake in Gokaldas Exports, the country's biggest apparel exporter, for about Rs 675 crore.
Blackstone Group manages around $90 billion of assets worldwide. In January, it invested about $275 million in Ushodaya Enterprises Ltd (UEL), a media and film production company owned by Ramoji Rao.
The record volume has been reached through 81 M&A deals. Last year, foreign private equity players had invested $2.6 billion, data complied by global consulting firm Dealogic showed.
Carlyle Group is the leading "financial sponsor" in India with investment of $777 million via two deals, including acquisition of over six per cent stake in HDFC.
It is followed by Dubai International Capital, which acquired a 2.87 per cent stake in ICICI Bank for $741 million, and Blackstone Group with $619 million inflow via eight deals.
Blackstone Group, the world's leading private equity firm, has acquired stake in companies such as Intelenet Global Services, Punj Lloyd and Gokaldas Exports.
The US-based Group has also decided to pump in $150 million to acquire a stake in Nagarjuna Construction Company. A move that comes close on the heels of its decision to acquire up to 70.1 per cent stake in Gokaldas Exports, the country's biggest apparel exporter, for about Rs 675 crore.
Blackstone Group manages around $90 billion of assets worldwide. In January, it invested about $275 million in Ushodaya Enterprises Ltd (UEL), a media and film production company owned by Ramoji Rao.
Tuesday, August 28, 2007
Indu Projects gets Rs453 cr from three US-based realty PE funds
Hyderabad-based infrastructure and construction company Indu Projects Ltd has closed $100 million investment from three unnamed US based private equity funds. Indu, which has an order book worth Rs 16,500 crore, is planning an IPO in the first half of 2008 probably to raise about Rs 1,000 crore ($250 million). A decision will be taken in next board meeting September.
The company had earlier raised angel investment from N Prasad of Matrix Laboratories Ltd (now acquired by Mylan Laboratories) and other individuals (Rs 99 crore), and first round of institutional financing of Rs 150 crore from Citigroup Venture Capital International. Currently, Indu’s promoters and associates hold around 80 per cent in the company and Citigroup Venture has around 9 per cent, the report adds, adding the current round of investment will be in three special purpose vehicles. They will invest Rs 220 crore, Rs 201 crore and Rs 32 crore in each of the three SPVs.
Indu is currently developing six integrated townships in Andhra Pradesh and Karnataka, two IT SEZs in Hyderabad and Nagpur, a biotechnology park near Hyderabad, a health city in South India, four agro food parks in AP and a highway project in Tamil Nadu on a build-own-transfer basis.
The company had earlier raised angel investment from N Prasad of Matrix Laboratories Ltd (now acquired by Mylan Laboratories) and other individuals (Rs 99 crore), and first round of institutional financing of Rs 150 crore from Citigroup Venture Capital International. Currently, Indu’s promoters and associates hold around 80 per cent in the company and Citigroup Venture has around 9 per cent, the report adds, adding the current round of investment will be in three special purpose vehicles. They will invest Rs 220 crore, Rs 201 crore and Rs 32 crore in each of the three SPVs.
Indu is currently developing six integrated townships in Andhra Pradesh and Karnataka, two IT SEZs in Hyderabad and Nagpur, a biotechnology park near Hyderabad, a health city in South India, four agro food parks in AP and a highway project in Tamil Nadu on a build-own-transfer basis.
Baring Private Equity Asia Invests $22 Million In KS Oils For 8.86% Stake
Baring Private Equity Partners Asia has picked up 8.86 per cent stake in leading edible oil manufacturer KS Oils Ltd for Rs 90 crore ($22 milion). Baring Private Equity Asia III Mauritius has picked up 21.48 million shares at Rs 41.90 apiece (of face value Re 1).
A board meeting of the publicly listed KS Oils on August 22 has cleared the deal, the company informed the stock exchanges. The company has also made a preferential allotment of 23,866,350 warrants (to be priced at Rs 41.9 at conversion) to promoters of the company. KS Oils is promoted by the Garg family of Morena, Madhya Pradesh.
KS Oils had last year raised Rs 90 crore from private equity fund, Citigroup Venture Capital International, which owns about 14.82 per cent stake in the company. CVCI is also believed to be investing again in KS Oils a similar amount.
Early this month, KS Oils had said it would raise $60 million from overseas investors. It plans to raise $25 million through a preferential issue of global depository receipts (GDRs) in one or more tranches to foreign funds such as CVCIGP II Client Rosehill Ltd and CVCIGP II Employee Rosehill Ltd. It also plans to issue Foreign Currency Convertible Bonds (FCCBs) or GDRs of up to $35 million in one or more tranches. The $22 million fund raising from Baring is part of this fund raising.
PricewaterhouseCoopers (PwC) is acting as sole financial adviser to KS Oils in all its fund raising efforts through private placement of equity, GDRs and FCCBs.
UTV Global Broadcasting To Raise $150 Million From Strategic Investors
Mumbai-based UTV Global Broadcasting is close to raising about Rs 600 crore ($150 million) from a group of strategic investors. Ronnie Screwvala, managing director, UTV,said “In the next 90 days, we may be able to talk about the strategic or financial investor in our broadcasting venture and we see the launch of most of these channels, or at least seven of them, starting this August and getting completed by March or April of next.”
UTV Global Broadcasting is a privately held company which holds its three broadcasting businesses. The company has three subsidiary companies - UTV News Ltd for the business news channel, GENX Entertainment Ltd for the four Bindass channels, and V&S Broadcasting for four channels.
UTV will put in Rs 150 crore ($37.5 million) as part of its contribution for the total project cost of Rs 600 crore. "The balance will be raised by a combination of equity at a premium and any other suitable instrument," the company executive director Shantonu Aditya said. UTV also plans to launch a Hindi movie channel in addition to Bindaas Movies and a World Cinema channel.
UTV Global Broadcasting is a privately held company which holds its three broadcasting businesses. The company has three subsidiary companies - UTV News Ltd for the business news channel, GENX Entertainment Ltd for the four Bindass channels, and V&S Broadcasting for four channels.
UTV will put in Rs 150 crore ($37.5 million) as part of its contribution for the total project cost of Rs 600 crore. "The balance will be raised by a combination of equity at a premium and any other suitable instrument," the company executive director Shantonu Aditya said. UTV also plans to launch a Hindi movie channel in addition to Bindaas Movies and a World Cinema channel.
RBI approves merger of Lord Krishna Bank with Centurion Bank
Reserve Bank of India has approved the scheme of amalgamation of Lord Krishna Bank with Centurion Bank of Punjab. The merger is effective August 29, 2007.Under the scheme of amalgamation, Centurion Bank of Punjab will issue up to 13.22 crore shares of Re 1 each to the shareholders of Lord Krishna Bank in the ratio of seven shares for every five held.
The Kerala High Court last week paved the way for the merger after it dismissed a petition by an LKB shareholder, ruling that there was no reason for ordering a probe by the government or any of its agencies into the affairs of the bank.
The shareholder, Umesh Kumar Pai, had filed a petition against LKB’s decisions at the annual general meeting on September 30, 2006 and sought an investigation into the bank’s affairs.
Monday, August 27, 2007
'Temasek wants Nasdaq's 30% stake in LSE'
Singapore’s state-owned Temasek Holdings has approached Nasdaq to buy its 30% stake in the London Stock Exchange (LSE), a newspaper reported on Sunday. The Sunday Times said in an unsourced report that Temasek had made the approach in recent days and the deal could lead to a full takeover of LSE by the Singaporean investor.
On August 20, Nasdaq Stock Market said it may sell its stake in LSE, worth £800 million ($1.6 billion), to bolster its chances of buying Nordic exchange operator OMX and it was already in touch with interested parties. The US exchange company said later in the day in a statement that it will not sell its LSE stake to a single buyer. The reported interest by Temasek, which owns stakes in UK banks Barclays and Standard Chartered, comes amid growing protectionism in Europe and the US towards sovereign wealth funds making aggressive overseas investments in search of higher returns.
The newspaper said several parties, including the New York Stock Exchange and the Chicago Mercantile Exchange, may enter the fray as well as investment and infrastructure funds, while another newspaper report said that Nasdaq was seeking to sell up to half of its LSE stake to Deutsche Boerse.Nasdaq, eager to expand its presence in overseas markets, is locked in a $4 billion bidding war with Borse Dubai for OMX, which owns exchanges in Sweden, Denmark, Finland, Iceland and the Baltic states.
On August 20, Nasdaq Stock Market said it may sell its stake in LSE, worth £800 million ($1.6 billion), to bolster its chances of buying Nordic exchange operator OMX and it was already in touch with interested parties. The US exchange company said later in the day in a statement that it will not sell its LSE stake to a single buyer. The reported interest by Temasek, which owns stakes in UK banks Barclays and Standard Chartered, comes amid growing protectionism in Europe and the US towards sovereign wealth funds making aggressive overseas investments in search of higher returns.
The newspaper said several parties, including the New York Stock Exchange and the Chicago Mercantile Exchange, may enter the fray as well as investment and infrastructure funds, while another newspaper report said that Nasdaq was seeking to sell up to half of its LSE stake to Deutsche Boerse.Nasdaq, eager to expand its presence in overseas markets, is locked in a $4 billion bidding war with Borse Dubai for OMX, which owns exchanges in Sweden, Denmark, Finland, Iceland and the Baltic states.
NIIT looking to offload 25% stake in Tech
NIIT Ltd, the promoter of Delhi-based IT company NIIT Technologies, is looking to sell 25% in the company to a strategic investor. NIIT Technologies is a listed entity and a 25% stake sale would trigger an open offer for a further 20%, thereby giving the buyer management control of the company.
“Our position has been that the promoters will dilute 25% out of the nearly 40% stake held by them to a strategic investor. This will naturally lead to an open offer. However, at this point of time, we are not in discussions with any investors,“ said NIIT Technologies CEO Arvind Thakur.
Sources in the industry say the company has initiated discussions with investment bankers for the possibility of a stake sale to a global IT company.
The size of a possible deal could not be ascertained as it depends mainly on the premium that the company can get. Sources say the company is looking at a high premium for the significant stake sale to strategic investors. “The management is looking at a high premium and thus keen to have a deal with a strategic investor. A deal with private equity funds is unlikely due to the premium expectations of the management,” said an industry source.
Read more in The Economic Times article.
“Our position has been that the promoters will dilute 25% out of the nearly 40% stake held by them to a strategic investor. This will naturally lead to an open offer. However, at this point of time, we are not in discussions with any investors,“ said NIIT Technologies CEO Arvind Thakur.
Sources in the industry say the company has initiated discussions with investment bankers for the possibility of a stake sale to a global IT company.
The size of a possible deal could not be ascertained as it depends mainly on the premium that the company can get. Sources say the company is looking at a high premium for the significant stake sale to strategic investors. “The management is looking at a high premium and thus keen to have a deal with a strategic investor. A deal with private equity funds is unlikely due to the premium expectations of the management,” said an industry source.
Read more in The Economic Times article.
Punjab Chemicals to acquire 100% stake in Pegevo
Punjab Chemicals & Crop Protection Ltd said on Monday it has agreed to acquire 100 per cent stake in Pegevo Beheer BV for an enterprise value of 39.5 million euros.The purpose of investment is strategic investment, it said in a statement.
Friday, August 24, 2007
Larsen & Toubro plans to raise $700 million
India’s Larsen & Toubro Ltd has sought shareholder approval for raising up to $700 million (Rs2,800 crore), as the country’s largest construction and engineering firm expands its operations overseas.
The company said it wants to raise the money through issues that could include global depositary receipts (GDRs), American depositary receipts (ADRs), foreign currency convertible bonds or other equity related instruments.
It has also sought approval from shareholders at the firm’s annual general meeting on Friday to authorise the board to convert previously issued GDRs to ADRs and list at Nasdaq or the New York Stock Exchange.
StanChart to buy 25.9% more in UTI Sec next year
After having acquired 49% stake for Rs 147 crore in UTI Securities, Standard Chartered Bank is looking to buy another 25.9% next year. It plans to take complete control of the financial services firm by 2010.
“Under the agreement with Securities Trading Corporation of India (STCI), we have the option to increase our stake to 100% in UTI Securities by 2010. We will be looking at acquire an additional 25.9% at a fixed price in 2008, while the remaining stake will be acquired in 2010 for the amount, which still needs to be determined,” said Neeraj Swaroop, chief executive officer-India, Standard Chartered Bank.
The proposal for clearing the stake was cleared by FIPB on Tuesday and the final deal was signed on Thursday.Swaroop said the management control would rest with both the partners, STCI and StanChart. “There will be 8 members on the board — 4 from STCI, 3 from StanChart and 1 is an independent director”.
With this acquisition, the foreign bank will be able to reap the benefits of institutional broking, retail broking and online broking facilities. “We can now use the retail banking portal, mutual fund products, investment banking and institutional brokerage facilities of UTI Securities. Their huge product range will help 2 million customers,” Swaroop said.
This strategic partnership will help the foreign bank establish offices in places where UTI Securities have its presence. As it is difficult for foreign banks in India to acquire licenses from the regulator, this is the best way for the bank to expand its network.
“Under the agreement with Securities Trading Corporation of India (STCI), we have the option to increase our stake to 100% in UTI Securities by 2010. We will be looking at acquire an additional 25.9% at a fixed price in 2008, while the remaining stake will be acquired in 2010 for the amount, which still needs to be determined,” said Neeraj Swaroop, chief executive officer-India, Standard Chartered Bank.
The proposal for clearing the stake was cleared by FIPB on Tuesday and the final deal was signed on Thursday.Swaroop said the management control would rest with both the partners, STCI and StanChart. “There will be 8 members on the board — 4 from STCI, 3 from StanChart and 1 is an independent director”.
With this acquisition, the foreign bank will be able to reap the benefits of institutional broking, retail broking and online broking facilities. “We can now use the retail banking portal, mutual fund products, investment banking and institutional brokerage facilities of UTI Securities. Their huge product range will help 2 million customers,” Swaroop said.
This strategic partnership will help the foreign bank establish offices in places where UTI Securities have its presence. As it is difficult for foreign banks in India to acquire licenses from the regulator, this is the best way for the bank to expand its network.
Reliance Cap takes 26% in transformer co
Betting on the buoyant transformer business in the country, Reliance Capital, through its private equity arm, has acquired 26% stake in Victory Transformer & Switchgear Ltd (VTSL), a fully integrated transformer manufacturing company, at a cost of Rs 75 crore.VTSL is a Hyderabad-based company, promoted by Vaddineni Venkatappaiah Naidu in 1996. It is currently managed by, his son, Mahindra Vaddineni.
In the past, Reliance ADAG has shown an appetite for transformer companies, and a couple of years ago, the group acquired a little over 5% in Emco Transformers through various associate investment companies. A Reliance ADAG spokesperson confirmed the development, but declined to share more detail.
VTSL primarily manufactures power transformers, but it is vertically integrated and manufactures related products like unitised substation, transformer core, vacuum circuit breaker, insulators and transformer oil. The company supplies to State Electricity Boards across the country and to major EPC contractors.
VTSL’s prospects can be seen in this context. Its revenues have grown at a compounded rate of 89% per annum over the last 2 years and it has an order book of over Rs 200 crore.
Read more in The DNA Money article.
Syndicate Bank to raise $125 million
Syndicate Bank is firming up plans to raise $125 million in the current fiscal through innovative perpetual bonds to boost its tier-I capital. The Manipal-headquartered bank is expected to get the board approval next month.
This issue, if the global markets cheer up, is expected to run parallel to the bank’s follow-on public issue which is also expected to hit the market by early next year. The bank, through this public offer, is expected to raise capital in the range of Rs 600-Rs 700 crore.
Syndicate Bank’s total assets is at Rs 91,000 crore which is expected to grow by 15 per cent by end of FY08. To maintain this growth momentum, it will have to raise more tier-I capital. Its capital adequacy ratio is currently at 12.62 per cent.
The decision to raise the $125 million comes just months after it recently raised $100 million from Wachovia Bank to fund its expansion plans in the European market. The bank is in the process of expanding its global presence by entering strategic global centres such as Singapore, China and Hong Kong.
At present, the government holds 66.3 per cent stake in Syndicate Bank, foreign institutional investors hold 13.3 per cent, 3.47 per cent is held by domestic institutional investors, while the rest by the general public. The bank is in the process of implementing Basel-II recommendations.
This issue, if the global markets cheer up, is expected to run parallel to the bank’s follow-on public issue which is also expected to hit the market by early next year. The bank, through this public offer, is expected to raise capital in the range of Rs 600-Rs 700 crore.
Syndicate Bank’s total assets is at Rs 91,000 crore which is expected to grow by 15 per cent by end of FY08. To maintain this growth momentum, it will have to raise more tier-I capital. Its capital adequacy ratio is currently at 12.62 per cent.
The decision to raise the $125 million comes just months after it recently raised $100 million from Wachovia Bank to fund its expansion plans in the European market. The bank is in the process of expanding its global presence by entering strategic global centres such as Singapore, China and Hong Kong.
At present, the government holds 66.3 per cent stake in Syndicate Bank, foreign institutional investors hold 13.3 per cent, 3.47 per cent is held by domestic institutional investors, while the rest by the general public. The bank is in the process of implementing Basel-II recommendations.
Holcim open offer for 20% Ambuja stake
Holcim, the world's second largest cement maker, announced plans to take majority control of Ambuja Cements (ACL) through purchase of 3.9% stake from the Sekhsaria-Neotia family and a subsequent 20% open offer for the minority shareholders.
Priced at Rs 154 a share - an 18% premium over the closing price of Rs 130.50 on Wednesday - the twin move will scale up the Swiss major’s shareholding in the country’s third largest cement company to marginally over 56% from the existing 32.3%. The move, subject to regulatory approvals, will cost Holcim $1.34 billion (Rs 5,463 crore).The investment will be financed from internal accruals, Holcim said in a release.
The open offer price of Rs 154 per share puts the enterprise value of ACL at $ 300 per tonne - the highest in the industry. The market capitalisation of ACL at the offer price would be Rs 23,408 crore.
Read more in The Business Standard article.
Wockhardt Hospitals plans Rs 812 cr IPO
Wockhardt Hospitals Ltd plans to raise over Rs 812 crore from its proposed initial public offering, for which it has filed papers with the Securities and Exchange Board of India.
The Wockhardt Ltd subsidiary will take the book building route for its 3 crore equity share float of Rs 10 each. The issue will constitute 28.77% of the post-issue capital.
The company is also considering a pre-IPO placement of up to 75 lakh shares, following which the net issue will reduce by that number, subject to minimum 10% of the post issue capital.
Wockhardt Hospitals plans to use the IPO proceeds to meet the cost of development and construction of greenfield and brownfield hospitals estimated at Rs 617.2 crore and prepay some of the short term loans estimated at Rs 195 crore.The equity shares will be listed on the Bombay Stock Exchange and National Stock Exchange.
Thursday, August 23, 2007
Rural Electrification Corp file papers for 156 mn share IPO
State-run lender Rural Electrification Corp Ltd (REC) has filed initial papers with the market regulator for a 156-million-share initial public offering, a senior official said on 23 August.
The book-built issue will equally comprise a fresh issue of shares and disinvestment by the federal government. Post-issue, the government’s stake in the firm will come down to 81.82% from 100%.The company is aiming to raise about Rs12 billion from the issue, another source close to the issue said. The funds raised from the fresh issue will be used for funding ongoing and future projects.
REC is the nodal agency for promoting rural electrification projects and also finances state electricity boards for investment in such projects. For the year to March 2007, it reported net profit of Rs6.6 billion on total income of Rs28.5 billion. The company is one of the three state-run power firms cleared earlier this year to sell equity, marking a limited revival of asset sales by the Indian government.
ICICI Securities Ltd, IL&FS Investsmart and SBI Capital Markets are the book-running lead managers to the issue
The book-built issue will equally comprise a fresh issue of shares and disinvestment by the federal government. Post-issue, the government’s stake in the firm will come down to 81.82% from 100%.The company is aiming to raise about Rs12 billion from the issue, another source close to the issue said. The funds raised from the fresh issue will be used for funding ongoing and future projects.
REC is the nodal agency for promoting rural electrification projects and also finances state electricity boards for investment in such projects. For the year to March 2007, it reported net profit of Rs6.6 billion on total income of Rs28.5 billion. The company is one of the three state-run power firms cleared earlier this year to sell equity, marking a limited revival of asset sales by the Indian government.
ICICI Securities Ltd, IL&FS Investsmart and SBI Capital Markets are the book-running lead managers to the issue
Firstsource frontrunner for $300mn MedAssit buy
A leading Indian pure-play business process outsourcing (BPO) firm, Firstsource Solutions, has emerged as the frontrunner in the quest to buy US-based healthcare player MedAssist. The deal size, say sources, is close to $300 million (around Rs 1,200 crore). If it takes place, the acquisition will be one of the largest overseas aquisitions after Wipro's buyout of Infocrossing for around $600 million, and the largest in the BPO space.
Sources close to the deal say there's one more serious contender in the race for MedAssist which has revenues of $90-100 million and provides provides services in patient services, eligibility services, patient financing and healthcare collections. It has around 1,400 employees and 950 healthcare providers as clients.
Firstsource is also rumoured to be in the race to acquire Citi's BPO unit after the first round of bidding. The sale of the BPO business, being run by Citigroup Global Services (formerly eServe), is expected to fetch Citi around Rs 3,200 crore. Other bidders include WNS and Genpact.
During its initial public offering (IPO) in end-January, the Firstsource management had indicated that the company intends to use the net proceeds of the issue to make acquisitions, set up new facilities, repay loan and for general corporate purposes. Out of the proceeds of the IPO, the company plans to spend approximately Rs 180 crore on acquisitions.
Sources close to the deal say there's one more serious contender in the race for MedAssist which has revenues of $90-100 million and provides provides services in patient services, eligibility services, patient financing and healthcare collections. It has around 1,400 employees and 950 healthcare providers as clients.
Firstsource is also rumoured to be in the race to acquire Citi's BPO unit after the first round of bidding. The sale of the BPO business, being run by Citigroup Global Services (formerly eServe), is expected to fetch Citi around Rs 3,200 crore. Other bidders include WNS and Genpact.
During its initial public offering (IPO) in end-January, the Firstsource management had indicated that the company intends to use the net proceeds of the issue to make acquisitions, set up new facilities, repay loan and for general corporate purposes. Out of the proceeds of the IPO, the company plans to spend approximately Rs 180 crore on acquisitions.
NSE likely to buy 5% in Chennai, B'lore SEs
The National Stock Exchange ( NSE) is planning to pick up stakes in the Chennai Stock Exchange and the Bangalore Stock Exchange.According to sources close to the development, the exchange could pick up 5 per cent each in these exchanges as per the demutualisation norms laid down by the market regulator Securities and Exchange Board of India.
The government has fixed a limit of 5 per cent as the maximum holding by an institution or an individual. However, no final decision has been taken as yet since the board will have to approve the stake purchase, said the sources.They added that if the decision to this effect is taken by the NSE, it will help promoting the regional stock exchanges. For the NSE, indications are that as of now this will be financial investment.
At a later date, the stock exchange may also promote a platform for an interconnected exchange for small and medium sector enterprises. If that happens, investment in regional exchanges will deliver fruits.
Read more in The Business Standard article.
The government has fixed a limit of 5 per cent as the maximum holding by an institution or an individual. However, no final decision has been taken as yet since the board will have to approve the stake purchase, said the sources.They added that if the decision to this effect is taken by the NSE, it will help promoting the regional stock exchanges. For the NSE, indications are that as of now this will be financial investment.
At a later date, the stock exchange may also promote a platform for an interconnected exchange for small and medium sector enterprises. If that happens, investment in regional exchanges will deliver fruits.
Read more in The Business Standard article.
Bombay Rayon may raise Rs 500cr via FPO
Bombay Rayon Fashions is embarking on a three-pronged modernisation, expansion and vertical integration strategy for its garments manufacturing facilities.The company is expected to raise the required funds through a secondary offering in the next three months. Market sources said the company is eyeing Rs 450-500 crore as gross proceeds from a follow-on public offer (FPO).
While the quantum of shares to be floated is not clear, sources indicated that rupee term loans from banks and other financial institutions could not be ruled out as a buffer against the prevailing market conditions.
About 70% of the funds raised through the secondary issue and other sources would be used for augmenting capacities in Leela Scottish Lace, the erstwhile garments business of Leela Ventures, which was acquired by Bombay Rayon for Rs 155 crore in July.
While the quantum of shares to be floated is not clear, sources indicated that rupee term loans from banks and other financial institutions could not be ruled out as a buffer against the prevailing market conditions.
About 70% of the funds raised through the secondary issue and other sources would be used for augmenting capacities in Leela Scottish Lace, the erstwhile garments business of Leela Ventures, which was acquired by Bombay Rayon for Rs 155 crore in July.
Fin Tech buys 1% NSE stake for Rs 125cr
Software firm Financial Technologies India has acquired 4,50,000 shares (1%) stake in National Stock Exchange from ICICI Bank for Rs 125 crore.According to a release issued by Financial Technologies to the BSE today, the company joins other NSE shareholders including the New York Stock Exchange (NSE), Goldman Sachs, ICICI, SBI, IDBI, LIC and various public sector banks.
NYSE and three financial investors — General Atlantic, Goldman Sachs and Softbank Asian Infrastructure Fund — had picked up 5% stake each in NSE for $490 million (Rs 2,205 crore) in January this year.That had pegged the upper-end valuation of the country’s largest bourse at $2.5 billion (Rs 11,250 crore). NSE had recorded a net profit of Rs 191 crore on a revenue of Rs 472 crore for the financial year ended March 31, 2006.
With the current FT-ICICI Bank deal, the valuation of NSE has moved up to Rs 12,500 crore - an increase of around 11% in seven months.
Primus Retail acquires Weekender
Primus Retail, one of the leading small format retail chains in India, has acquired lifestyle brand Weekender from the Jagadish Hinduja family, the owners of Gokaldas Images.
Speaking on the acquisition, Primus CEO Balaji said:“Besides expanding our retail network, we have been looking at inorganic opportunities and acquiring a brand like Weekender will help us in expanding our portfolio, allowing us to consolidate our position as a leader in the apparel and small format retail industry.”
According to the release issued by Primus, Weekender has more than 50 stores including outlets in department stores. Primus plans to renovate the existing stores and plans to add more stores in the next 12 months.The deal size was not disclosed.
Speaking on the acquisition, Primus CEO Balaji said:“Besides expanding our retail network, we have been looking at inorganic opportunities and acquiring a brand like Weekender will help us in expanding our portfolio, allowing us to consolidate our position as a leader in the apparel and small format retail industry.”
According to the release issued by Primus, Weekender has more than 50 stores including outlets in department stores. Primus plans to renovate the existing stores and plans to add more stores in the next 12 months.The deal size was not disclosed.
Standard Chartered to acquire 49% stake in UTI Securities
Global banking major Standard Chartered Plc on Thursday entered into a strategic partnership with the Securities Trading Corporation of India (STCI) to acquire the latter's 49 per cent stake in UTI Securities for Rs 147 crore.STCI owns 100 per cent of UTI Securities after acquiring it in 2006 from the Administrator of the Specified Undertaking of the Unit Trust of India.
Under the agreement, the parties have provided for necessary options to raise Standard Chartered's stake to 100 per cent in stages by 2010, subject to necessary regulatory approvals, a release issued here today said.
According to Standard Chartered CEO Neeraj Swaroop, "the partnership will enable Standard Chartered to broaden its product offering in wealth management and private banking within India and the non-resident Indian (NRI) product portfolio in our footprint countries."
Wednesday, August 22, 2007
Canaan Partners picks up 39% stake in Cellcast’s Asia spin-off
Canaan Partners, the $2.3 billion (Rs9,453 crore), Menlo Park-headquartered venture capital investor, has invested $5.25 million in digital media company Cellcast Asia Holdings, marking the second VC-backed spin-out deal in the country in two months.
Earlier, IDG Ventures India invested $6 million in ConnectM Technology Solutions Pvt. Ltd, a communications solutions company spun out of Sasken Communication Technologies Ltd. Unlike ConnectM, which will address opportunities untapped by Sasken’s core business, Cellcast Asia will replicate the business model of its parent company.
The Mumbai-based Cellcast Asia Holdings has been spun off from its UK parent Cellcast Plc. Canaan has picked up a 38.9% stake; the employees will hold 23.6% through a trust and Cellcast will retain a 37.5% stake. This is Canaan’s fourth deal in the country since it started investing here in 2006 out of its global $450 million fund.
Cellcast Asia Holdings was formally constituted after the UK company decided to consolidate its almost two-year-old Asia operations—Cellcast Interactive India Pvt. Ltd, a 100% subsidiary set up in 2005, and Cellcast SEA Ltd, a 50:50 joint venture in Malays
Earlier, IDG Ventures India invested $6 million in ConnectM Technology Solutions Pvt. Ltd, a communications solutions company spun out of Sasken Communication Technologies Ltd. Unlike ConnectM, which will address opportunities untapped by Sasken’s core business, Cellcast Asia will replicate the business model of its parent company.
The Mumbai-based Cellcast Asia Holdings has been spun off from its UK parent Cellcast Plc. Canaan has picked up a 38.9% stake; the employees will hold 23.6% through a trust and Cellcast will retain a 37.5% stake. This is Canaan’s fourth deal in the country since it started investing here in 2006 out of its global $450 million fund.
Cellcast Asia Holdings was formally constituted after the UK company decided to consolidate its almost two-year-old Asia operations—Cellcast Interactive India Pvt. Ltd, a 100% subsidiary set up in 2005, and Cellcast SEA Ltd, a 50:50 joint venture in Malays
Print powerhouse Malar plans IPO for its Hello FM radio station
Malar Publications Ltd that publishes Tamil Nadu’s largest evening daily, Maalai Malar, plans to sell shares in its radio operation Hello FM through an initial public offering (IPO) within the next 12 months, aiming to parlay a growing market for private radio broadcasting into capital.
The offer of sale of shares to the public will be the first from the state’s largest vernacular print-media house. Malar Publications is part of the Daily Thanthi Group that publishes one of India’s largest selling newspapers, Daily Thanthi, with a turnover of around Rs350 crore.
Malar Publications launched Hello FM in Chennai last October, and will open in an additional six cities in Tamil Nadu by the end of next month.The group has spent Rs25 crore in acquiring licences for operating the stations, and has earmarked an additional Rs35 crore on infrastructure and marketing expenditure. So far, the group has funded the company through internal accruals, said Nambiar. He added that the expansion, too, would be funded the same way.
Read more in The Livemint article.
The offer of sale of shares to the public will be the first from the state’s largest vernacular print-media house. Malar Publications is part of the Daily Thanthi Group that publishes one of India’s largest selling newspapers, Daily Thanthi, with a turnover of around Rs350 crore.
Malar Publications launched Hello FM in Chennai last October, and will open in an additional six cities in Tamil Nadu by the end of next month.The group has spent Rs25 crore in acquiring licences for operating the stations, and has earmarked an additional Rs35 crore on infrastructure and marketing expenditure. So far, the group has funded the company through internal accruals, said Nambiar. He added that the expansion, too, would be funded the same way.
Read more in The Livemint article.
Sintex plans a European buy
Plastic and textiles maker Sintex Industries Ltd plans to acquire a composites firm with sales of about $30 million in Europe by March 2008, a top company official said.The company is on the verge of finalising a deal in Europe, where it has been talking to 3-4 companies, managing director Amit Patel said on Tuesday.
report continued below
“We do have a presence in the US market, now we are keen to have distribution network in the European market. The acquisition will help us strengthen our technology and network,” he said.
Sintex acquired Wisconsin-based Wausaukee Composites for $20.5 million in June. In 2006 it bought the south Asian operations of Germany’s Zeppelin Mobile System, and is still scouting for more in the plastic composites segment.
“Just in case the deal does not materialise in Europe, we have some companies in US who are interested in having us as acquirers,” Patel said. “The acquisitions will help in building a global presence in the auto and electrical plastic accessories market and add to the company’s consolidated topline as well as bottom line.”
Sintex is also considering buying an Indian composites company by December 2007.
It has set aside Rs 110 crore to be funded through internal accruals for these acquisitions, Patel said.
Read more in The DNA Money article.
report continued below
“We do have a presence in the US market, now we are keen to have distribution network in the European market. The acquisition will help us strengthen our technology and network,” he said.
Sintex acquired Wisconsin-based Wausaukee Composites for $20.5 million in June. In 2006 it bought the south Asian operations of Germany’s Zeppelin Mobile System, and is still scouting for more in the plastic composites segment.
“Just in case the deal does not materialise in Europe, we have some companies in US who are interested in having us as acquirers,” Patel said. “The acquisitions will help in building a global presence in the auto and electrical plastic accessories market and add to the company’s consolidated topline as well as bottom line.”
Sintex is also considering buying an Indian composites company by December 2007.
It has set aside Rs 110 crore to be funded through internal accruals for these acquisitions, Patel said.
Read more in The DNA Money article.
Blackstone's $109 Investment In Intelenet BPO Holding Company Cleared
Blackstone's proposal to invest Rs 447.2 crore ($109 million) in an operating and holding firm SKR BPO Services has been approved by India's Foreign Investment Promotion Board (FIPB). SKR BPO is a recently formed vehicle which has carried out the management buyout of Intelenet BPO. Blackstone GVP Capital, Mauritius, and the Intelenet management own the company jointly.
Blackstone is believed to be holding about 80 per cent stake in the company. Blackstone's capital infusion will also be used to "make further downstream investment by way of acquisition of existing shares".' SKR has made an open offer for 20 per cent of shares in the publicly listed Sparsh BPO, in which Intelenet holds 51 per cent stake.This would cost SKR BPO about Rs 64.59 crore, as it plans to acquire 3.23 million shares at an offer price of Rs 200 per share.
FIPB rejects plan to sell 5% DSE stake to FII
The Foreign Investment Promotion Board (FIPB) has rejected Mauritius-based Passport India Investments proposal to buy a 5 per cent stake in the Delhi Stock Exchange (DSE), while deferring a decision on five other FDI proposals.
The FIPB rejected the proposal of Passport India, a fund promoted by US-based Passport Capital LLC, after the Securities and Exchange Board of India objected to a foreign institutional investor buying shares in the primary issue of a stock exchange, DSE sources said.
The rejection and deferment were announced today. According to an official release, Finance Minister P Chidambaram has approved the FIPB’s recommendations for 20 FDI proposals, made at its meeting on August 17.
Of the six investment proposals in the DSE for a 26 per cent stake, the FIPB cleared four proposals for taking a 20 per cent stake in the bourse. The FIPB deferred decision on the proposal of non-resident Indian Bhupendra Kumar Modi to buy 1 per cent stake in the DSE.
With the August-end deadline approaching to finalise domestic and foreign investors for offloading a minimum of a 51 per cent stake in the bourse according to Sebi’s demutualisation scheme, two new FDI proposals have been submitted to the FIPB for investing in the DSE, sources say.The DSE can offload a maximum 26 per cent stake in the exchange to foreign investors.
The two new foreign investment proposals in DSE are from Mauritius-based funds, New Vernon Private Equity Fund and Passport Global Master Fund.
The DSE is trying to secure an approval for the new proposals prior to the next FIPB meeting scheduled for August 31 as it has to submit the name of investors to Sebi at the earliest.
While the DSE is selling 26 per cent stake to foreign investors, it proposes to dilute a minimum 25 per cent stake to domestic investors. The DSE, defunct for the last three years, is trying to revive itself.
The FIPB rejected the proposal of Passport India, a fund promoted by US-based Passport Capital LLC, after the Securities and Exchange Board of India objected to a foreign institutional investor buying shares in the primary issue of a stock exchange, DSE sources said.
The rejection and deferment were announced today. According to an official release, Finance Minister P Chidambaram has approved the FIPB’s recommendations for 20 FDI proposals, made at its meeting on August 17.
Of the six investment proposals in the DSE for a 26 per cent stake, the FIPB cleared four proposals for taking a 20 per cent stake in the bourse. The FIPB deferred decision on the proposal of non-resident Indian Bhupendra Kumar Modi to buy 1 per cent stake in the DSE.
With the August-end deadline approaching to finalise domestic and foreign investors for offloading a minimum of a 51 per cent stake in the bourse according to Sebi’s demutualisation scheme, two new FDI proposals have been submitted to the FIPB for investing in the DSE, sources say.The DSE can offload a maximum 26 per cent stake in the exchange to foreign investors.
The two new foreign investment proposals in DSE are from Mauritius-based funds, New Vernon Private Equity Fund and Passport Global Master Fund.
The DSE is trying to secure an approval for the new proposals prior to the next FIPB meeting scheduled for August 31 as it has to submit the name of investors to Sebi at the earliest.
While the DSE is selling 26 per cent stake to foreign investors, it proposes to dilute a minimum 25 per cent stake to domestic investors. The DSE, defunct for the last three years, is trying to revive itself.
Spencer's in talks with global retailers for JV
Spencer's Retail, promoted by the Rs 11,500 crore RPG Group, is in talks with international retailers for a possible joint venture in India.Spencer's is also planning to introduce new formats and could explore the JV route to launch them.
"The new JV will not be in food retail since our existing formats function in that area. We are talking to couple of international players. The new venture will be consolidated by the group. Hopefully, we will be able to take a call on the new venture in a couple of months time,'' said Goenka.
Spencer's currently has 250 outlets across 40 cities. The company would
open 500 stores in the next 12 months and 600 stores an year after, he said. The company is planning to invest Rs 1,100 crore to expand its network of stores.
The company will use a mix of internal accruals, debt and equity to fund expansion plans."We will take a call on the initial public issue in the next 6 months," he said. The company expects a turnover of Rs 2,500 crore to Rs 3,000 crore a year in the next two years. Currently, its sales stand at Rs 750 crore.
"The new JV will not be in food retail since our existing formats function in that area. We are talking to couple of international players. The new venture will be consolidated by the group. Hopefully, we will be able to take a call on the new venture in a couple of months time,'' said Goenka.
Spencer's currently has 250 outlets across 40 cities. The company would
open 500 stores in the next 12 months and 600 stores an year after, he said. The company is planning to invest Rs 1,100 crore to expand its network of stores.
The company will use a mix of internal accruals, debt and equity to fund expansion plans."We will take a call on the initial public issue in the next 6 months," he said. The company expects a turnover of Rs 2,500 crore to Rs 3,000 crore a year in the next two years. Currently, its sales stand at Rs 750 crore.
PGCIL aims to raise Rs 580 cr through IPO
Power Grid Corporation of India Ltd (PGCIL), the country's biggest transmission utility, on Wednesday filed its red herring prospectus with market regulator SEBI for its initial public offer to raise an estimated 580 crore.
PGCIL is the third central power utility to tap the capital market for raising funds after NTPC Ltd in 2004 and Power Finance Corporation early this year.Like NTPC and PFC, the government will piggyback on PGCIL IPO to divest five per cent of its stake. While NTPC had raised around Rs 5,400 crore, PFC had mopped up nearly Rs 1,000 crore. Power Grid is expected to mobilise up to Rs 580 crore, sources said.
The public issue comprises 57.39 crore equity shares of Rs 10 each. This includes a fresh issue of 38.26 crore shares by PGCIL and an offer for sale of 19.13 crore shares by the government. About 1.39 crore shares have been reserved for employees and the net issue to public is 55.99 crore shares.
The company will issue shares at a price to be decided through the book building process and the shares will be listed on Bombay Stock Exchange and National Stock Exchange.
Kotak Mahindra Capital Company Ltd, Citigroup global Markets India and Enam Financial Consultants are the book running lead managers to the issue.
PGCIL is the third central power utility to tap the capital market for raising funds after NTPC Ltd in 2004 and Power Finance Corporation early this year.Like NTPC and PFC, the government will piggyback on PGCIL IPO to divest five per cent of its stake. While NTPC had raised around Rs 5,400 crore, PFC had mopped up nearly Rs 1,000 crore. Power Grid is expected to mobilise up to Rs 580 crore, sources said.
The public issue comprises 57.39 crore equity shares of Rs 10 each. This includes a fresh issue of 38.26 crore shares by PGCIL and an offer for sale of 19.13 crore shares by the government. About 1.39 crore shares have been reserved for employees and the net issue to public is 55.99 crore shares.
The company will issue shares at a price to be decided through the book building process and the shares will be listed on Bombay Stock Exchange and National Stock Exchange.
Kotak Mahindra Capital Company Ltd, Citigroup global Markets India and Enam Financial Consultants are the book running lead managers to the issue.
Arch Pharmalabs acquires Watsol Organics
Drug maker Arch Pharmalabs has acquired Watsol Organics, a manufacturer of pharmaceuticals and agro-chemical intermediates, for Rs 30 crore.The acquisition was funded through internal accruals, Arch said in a statement.
"Inorganic growth is a strong component of our growth strategy. Strategic fit and value proposition have always been the drivers for acquisitions," Arch Pharmalabs CMD Ajit Kamath said.
The acquisition would give Arch Pharmalabs raw materials and intermediates to manufacture Isoxazole side chains.This is the fifth acquisition of Arch Pharmalabs. The company expects its sales to touch Rs 500 crore in FY 2010.
"Inorganic growth is a strong component of our growth strategy. Strategic fit and value proposition have always been the drivers for acquisitions," Arch Pharmalabs CMD Ajit Kamath said.
The acquisition would give Arch Pharmalabs raw materials and intermediates to manufacture Isoxazole side chains.This is the fifth acquisition of Arch Pharmalabs. The company expects its sales to touch Rs 500 crore in FY 2010.
Tuesday, August 21, 2007
Biyani to up his stake in Pantaloon
Kishore Biyani, the promoter of Future group, plans to increase his stake in Pantaloon Retail India Ltd (PRIL). The stake increase is expected to be around 13.5%, which will be done by infusing over Rs 1,000 crore through convertible equity warrants.
Capital funding, according to analysts, would have been the biggest roadblock Pantaloon Retail would have faced in achieving its growth ambitions.
report continued below
In all, the company is looking at raising over Rs 1,200 crore through a combination of promoter investments, two undisclosed institutional investors and employees. Analysts envisage the dilution in equity to be around 17%.
The PRIL board has approved raising funds to the tune of Rs 200 crore by issuing 40 lakh equity shares at a premium of Rs 498 per share. Pantaloon Retail India Ltd (PRIL) has also finalised plans to invest Rs 325 crore into a subsidiary company, Pantaloon Future Ventures Ltd (FVL).
Read more in The DNA Money article.
Motilal IPO subscribed 1.96 times on first day
The initial public offering (IPO) of Motilal Oswal Financial Services got subscribed by 1.96 times, according to the National Stock Exchange website. Nearly 1 per cent of the total bids received for close to 30 lakh equity shares on offer were at the cut-off price. The shares were priced in a band of Rs 725 to Rs 825. The issue closes on August 23.
The qualified institutional buyers’ (QIB) portion has been subscribed by 3.33 times. Foreign institutional investors have placed bids for all shares in the QIB portion. Nearly 6 per cent of the total shares reserved for retail investors have received bids so far. The portion for non-institutional investors has been subscribed 0.4 times.
Lehman picks 26% in Edelweiss` NBFC
The New York-headquartered Lehman Brothers has picked up 26 per cent stake in ECL Finance, the non-banking finance company of Edelweiss Capital, for close to Rs 180 crore.The acquisition comes within days after Lehman Brothers bought the institutional broking business of Brics Securities, a Mumbai-based broking house.
In March, the Mumbai-based financial services company Edelweiss announced its foray into the non-banking financial space and asset management by investing a total of Rs 400 crore in the new ventures.The NBFC would be looking at mortgage business and other credit instruments.
Last week, Edelweiss filed a prospectus with the capital market regulator, the Securities and Exchange Board of India (Sebi), for its initial public offering. The company will be offering 8.3 million equity shares of Rs 5 each and the post issue dilution is 10.92 per cent.A portion of the proceeds of the issue will be used to buy office space of about 30,000 sq ft either for ECL Finance or for Edelweiss Securities.
Read more in The Business Standard article.
Blackstone buys Gokaldas Exports
Global private equity giant Blackstone Group is acquiring majority control in Gokaldas Exports for nearly Rs 660 crore, in the country’s largest management buyout in the textiles industry.
Blackstone will acquire a 70 per cent stake in Gokaldas through a two-step deal — 50 per cent from the Bangalore-based Hinduja family and 20 per cent through an open offer to other shareholders. Kotak Investment Bank was the advisor to the transaction and is the manager for the open offer.The deal will price one share of Gokaldas Exports at Rs 275, a 20 per cent premium over today’s close of Rs 228.70.
This is Blackstone’s third major deal this year, the other two being a $275 million investment in Ushodaya Enterprises, which runs the Eenadu newspaper and ETV franchise, and a management buy-out of BPO firm Intelenet from Barclays and HDFC for Rs 840 crore.
Akhil Gupta, CMD of Blackstone Advisors India, said his company was attracted by the growth potential of Gokaldas. “With the abolition of the quota regime, the potential of Indian textiles exporters is huge,” he added.He said Blackstone would restructure the Gokaldas board after the open offer.
Read more in The Business Standard article.
Going global: JSW Steel announces $900 mn US acquisition
JSW Steel has acquired three companies in the US for $900 million to expand its geographical footprint. The target companies are Jindal United Steel Corporation, Saw Pipes, USA and Jindal Enterprises LLC.
These have 1.2 million net tonne of plate mill, 0.55 million net tonne of pipe mill and 0.35 million net tonne of double jointing and coating lines. These facilities are strategically located near a deep-water port, central to Gulf of Mexico oil and gas industries.
With this acquisition, JSW would get an entry point into growing and booming oil & gas sector in North America. The company would enhance the income accretive business model for immediate access to customers and markets through product diversification, market diversification and geographical diversification.
On completion of due diligence, JSW Steel will acquire 90% stake at an approved enterprise valuation and the balance 10% will be retained by some of the existing shareholders.
The acquisition price of $900 million works out to 6.25 times of the EBIDTA for 2006-07 (Apr-Mar) and is comparable with the transaction EBIDTA multiple of 4.7 to 14.8 times for similar transaction in the steel industry internationally, the company said in a notice to BSE.
Read more in The Economic Times article.
These have 1.2 million net tonne of plate mill, 0.55 million net tonne of pipe mill and 0.35 million net tonne of double jointing and coating lines. These facilities are strategically located near a deep-water port, central to Gulf of Mexico oil and gas industries.
With this acquisition, JSW would get an entry point into growing and booming oil & gas sector in North America. The company would enhance the income accretive business model for immediate access to customers and markets through product diversification, market diversification and geographical diversification.
On completion of due diligence, JSW Steel will acquire 90% stake at an approved enterprise valuation and the balance 10% will be retained by some of the existing shareholders.
The acquisition price of $900 million works out to 6.25 times of the EBIDTA for 2006-07 (Apr-Mar) and is comparable with the transaction EBIDTA multiple of 4.7 to 14.8 times for similar transaction in the steel industry internationally, the company said in a notice to BSE.
Read more in The Economic Times article.
Monday, August 20, 2007
Future Capital IPO Decided; Pantaloon To Invest Rs 325 Crore In Future Ventures
Future Capital Holdings, the financial arm of the Kishore Biyani-owned Pantaloon Retail, is tapping capital market to raise funds. The board of directors of Pantaloon Retail has taken a decision to go public. Pantaloon Retail owns 74 per cent stake in Future Capital, while a 10 per cent stake is held by hedge fund Och-Ziff Capital, and the rest by employees including CEO Sameer Sain.
At a meeting held on Saturday, the board of Pantaloon Retail decided that the IPO of the Future Capital holdings Ltd would seek to sell 10 per cent of the post issue capital. The company has made a stock exchange announcement today to this effect. UBS Investment recently valued the business of Future Capital to be around Rs 3,000 crore.
Future Capital operates four private equity funds - Kshitij ($850 million domestic real estate fund), Horizon ($350 million international real estate fund); IndiVision Capital ($400 million consumer sector private equity fund), besides a $350-million private equity fund. Future has also launched a consumer credit business.
The board has also approved an investment of Rs. 325 crore in Pantaloon Future Ventures Ltd, a wholly owned subsidiary of the company for making downstream investment into Future Ventures India Ltd. which has been set up to undertake new businesses, incubation of new ideas and businesses and getting into joint ventures, the stock exchange announcement said.
At a meeting held on Saturday, the board of Pantaloon Retail decided that the IPO of the Future Capital holdings Ltd would seek to sell 10 per cent of the post issue capital. The company has made a stock exchange announcement today to this effect. UBS Investment recently valued the business of Future Capital to be around Rs 3,000 crore.
Future Capital operates four private equity funds - Kshitij ($850 million domestic real estate fund), Horizon ($350 million international real estate fund); IndiVision Capital ($400 million consumer sector private equity fund), besides a $350-million private equity fund. Future has also launched a consumer credit business.
The board has also approved an investment of Rs. 325 crore in Pantaloon Future Ventures Ltd, a wholly owned subsidiary of the company for making downstream investment into Future Ventures India Ltd. which has been set up to undertake new businesses, incubation of new ideas and businesses and getting into joint ventures, the stock exchange announcement said.
PE Texas, Apax to buy stake in Patni
Private equity firms Texas Pacific Group and Apax Partners are close to buying some of the founders' stake in India's Patni Computer Systems Ltd.Gajendra and Ashok Patni, two of the three brothers who founded the software services firm, are looking to sell their stake, local media had earlier reported.
Their holding in the company totals to about 29 per cent. The agreement between one of the private equity partners and the Patni brothers is likely to be signed next month, the media said.
A spokeswoman for New York-listed Patni, which counts General Electric Co and ABN AMRO among its clients, said the company had no comment to make on the report. Chairman and Chief Executive Narendra Patni, who holds about 15 per cent of the company, will buy out a part of the stake on offer while the private equity firms will pick up the remaining, the daily said.
Their holding in the company totals to about 29 per cent. The agreement between one of the private equity partners and the Patni brothers is likely to be signed next month, the media said.
A spokeswoman for New York-listed Patni, which counts General Electric Co and ABN AMRO among its clients, said the company had no comment to make on the report. Chairman and Chief Executive Narendra Patni, who holds about 15 per cent of the company, will buy out a part of the stake on offer while the private equity firms will pick up the remaining, the daily said.
PNB may bid for IFCI stake
"Punjab National Bank may bid for a 26 per cent holding in institutional lender IFCI Ltd.", said the bank's chairman and managing director."The bank's board will take a final call on the matter," K.C. Chakraborty said, adding the bank shared some common account holders with IFCI.
The state-run Punjab National Bank had sought to acquire a controlling stake in IFCI more than three years ago but the proposal fell through. A spokesman at the bank could not be immediately reached.
State-run IFCI is looking for a strategic investor and has appointed Ernst & Young as its advisors.Citigroup, Lehman Brothers, BNP Paribas, Deutsche Bank and Barclays were eyeing a 26 per cent in IFCI.
The state-run Punjab National Bank had sought to acquire a controlling stake in IFCI more than three years ago but the proposal fell through. A spokesman at the bank could not be immediately reached.
State-run IFCI is looking for a strategic investor and has appointed Ernst & Young as its advisors.Citigroup, Lehman Brothers, BNP Paribas, Deutsche Bank and Barclays were eyeing a 26 per cent in IFCI.
Friday, August 17, 2007
Tata Power offloads 4.2% in PTC for Rs 50 crore
Tata Power has sold 4.2% in PTC India in the open market for about Rs 50 crore. Tata group’s power generation arm was one of the early investors in PTC, formerly Power Trading Corporation. The partial stake sale comes at a time when PTC has announced it will raise Rs 1,200 crore from the market to fund expansion plans. Existing investors would be required to pump in more money or see their stake come down.
As per the stock exchange disclosures, Tata Power held 10.47% till March 2007. The company diluted its holding marginally during the April-June quarter. Thereafter, it sold an additional 3.35% in the open market over the past six weeks. Last week, Amulya Charan, a Tata Power nominee on the PTC India board had resigned. As per the average market price of TPC share during the time of the sale, Tata Power is expected to have fetched close to Rs 50 crore out of which about Rs 40-42 crore would have been generated in the current quarter.
Tata Power still holds 6.3% equity in PTC, valued at about Rs 70 crore. Tata Power had invested Rs 17.6 crore to acquire the stake in PTC over a period of time.
Just before the initial public offering (IPO) of PTC in March 2004, Tata Power was the single largest stake holder in the company having about 16% stake.Tata Power’s holding came down after the IPO to about 10% and till June 2007 it remained the single largest equity holder.
As per the stock exchange disclosures, Tata Power held 10.47% till March 2007. The company diluted its holding marginally during the April-June quarter. Thereafter, it sold an additional 3.35% in the open market over the past six weeks. Last week, Amulya Charan, a Tata Power nominee on the PTC India board had resigned. As per the average market price of TPC share during the time of the sale, Tata Power is expected to have fetched close to Rs 50 crore out of which about Rs 40-42 crore would have been generated in the current quarter.
Tata Power still holds 6.3% equity in PTC, valued at about Rs 70 crore. Tata Power had invested Rs 17.6 crore to acquire the stake in PTC over a period of time.
Just before the initial public offering (IPO) of PTC in March 2004, Tata Power was the single largest stake holder in the company having about 16% stake.Tata Power’s holding came down after the IPO to about 10% and till June 2007 it remained the single largest equity holder.
Hershey’s India stake up at 57.8%
The popular US chocolate maker Hershey Co. plans to increase its stake in its India unit Godrej Hershey Beverages and Foods from 51% to 57.8%.According to A Mahendran, chief executive, the company will be buying more shares from its parent company.
In April this year, Hershey had bought a 51% stake in Godrej Beverages & Foods. This was to the tune of $55 million (Rs 22crore) out of which the chocolate maker plans to undertake the construction of a building in north India. The plan is to make hard candy which they feel the Indian market is likely to lap up. The company also has plans of creating a manufacturing facility in India to service their needs over a long term period.
StanChart-UTI Securities Deal May Be Cleared By FIPB Today
Standard Chartered Bank's proposal to pick up 49 per cent stake in broking firm UTI Securities is under the consideration of Foreign Investment Promotion Board (FIPB), reports TV channel CNBC-TV18.FIPB is taking up the Stanchart proposal at a meeting to be held on August 17. So this deal is likely to be cleared today. The financial terms are not known as this post is being written.
UTI Securities is currently owned by Securities Trading Corporation of India, which had put 49 per cent stake in the broking firm on the block. There were several firms like Kuwait's Global Investment House, Citigroup, Macquarie Bank, and Societe Generale in talks with STCI to buy a stake.
Several banks are looking for an entry into broking and financial products distribution, so a firm like UTI Sec offered synergy. STCI bought UTI Sec in February 2006 for Rs 265 crore from the Specified Undertaking of UTI. STCI will sell 49 per cent of it now, and the rest after the lock-in period which will end in 2009.
UTI Securities is currently owned by Securities Trading Corporation of India, which had put 49 per cent stake in the broking firm on the block. There were several firms like Kuwait's Global Investment House, Citigroup, Macquarie Bank, and Societe Generale in talks with STCI to buy a stake.
Several banks are looking for an entry into broking and financial products distribution, so a firm like UTI Sec offered synergy. STCI bought UTI Sec in February 2006 for Rs 265 crore from the Specified Undertaking of UTI. STCI will sell 49 per cent of it now, and the rest after the lock-in period which will end in 2009.
VISA Steel forms JV with Baosteel
Visa Steel Ltd has entered into a joint venture with Baosteel Trading of China and VISA Comtrade of Switzerland for setting up a 1,00,000 tonne per annum ferro chrome plant in Orissa.
VISA Steel will hold 51% stake in the venture, VISA Bao Ltd, while Baosteel Trading and VISA Comtrade will hold 35% and 14% shares respectively.The cost of setting up the ferro chrome plant and related infrastructure is estimated around Rs 260 crore, which will be financed through debt:equity ratio of 85:35.
VISA Steel also plans to commission its 300,000 tpa sponge iron plant and 50 MW waste heat recovery power plant by the end of 2007-08 (Apr-Mar) and the 0.5 million tpa special and stainless steel plant including a bar & wire rod mill and an additional 25 MW power plant by end of 2008-09.
VISA Steel will hold 51% stake in the venture, VISA Bao Ltd, while Baosteel Trading and VISA Comtrade will hold 35% and 14% shares respectively.The cost of setting up the ferro chrome plant and related infrastructure is estimated around Rs 260 crore, which will be financed through debt:equity ratio of 85:35.
VISA Steel also plans to commission its 300,000 tpa sponge iron plant and 50 MW waste heat recovery power plant by the end of 2007-08 (Apr-Mar) and the 0.5 million tpa special and stainless steel plant including a bar & wire rod mill and an additional 25 MW power plant by end of 2008-09.
Thursday, August 16, 2007
Nortel takes stake in Tejas Networks
Nortel Networks is picking a minority stake in Bangalore-based optical network firm Tejas Networks. The deal is part of a product sourcing arrangement wherein the $11.4-billion Canadian telecom equipment company was to get the equity stake after certain purchase milestones with Tejas as the original equipment manufacturer (OEM) supplier.
According to sources close to the deal, Tejas would issue warrants to Nortel to acquire 12,954 equity shares of Rs 10 each at a premium of Rs 9,046 per share. This would translate into an investment of about Rs 12 crore.
Significantly, the price at which the warrants would be issued has been modified recently. As per the original terms of the agreement between Nortel and Tejas struck three years back, the exercise price of each share was fixed at Rs 13,115. However, last month the two parties decided to change the exercise price to Rs 9,056 per share. In this transaction, Nortel is not being inducted as a promoter and would not have a lock-in period for its shares.
Incidentally, Tejas is expected to go public next year. Though it is not clear if the public offering would be launched in India or in the US.
As per the deal between the two parties, a certain number of warrants was to vest with Nortel after each $5 million worth of OEM purchase from Tejas. In total 12,954 warrants was to vest with Nortel after its cumulative OEM purchase from Tejas hit the $50 million mark.
Tejas is a privately-owned company co-founded by Sanjay Nayak (CEO), Kumar Sivarajan (CTO) and Arnob Roy (VP Engineering). It is backed by investors, including serial entrepreneur and ace venture capitalist Gururaj Deshpande, and VC firms Battery Ventures and Mayfield. The other investors include US-headquartered Sycamore Networks, investment funds Sandstone Capital, Intel Capital and the Khemkas-owned Sun Group.
According to sources close to the deal, Tejas would issue warrants to Nortel to acquire 12,954 equity shares of Rs 10 each at a premium of Rs 9,046 per share. This would translate into an investment of about Rs 12 crore.
Significantly, the price at which the warrants would be issued has been modified recently. As per the original terms of the agreement between Nortel and Tejas struck three years back, the exercise price of each share was fixed at Rs 13,115. However, last month the two parties decided to change the exercise price to Rs 9,056 per share. In this transaction, Nortel is not being inducted as a promoter and would not have a lock-in period for its shares.
Incidentally, Tejas is expected to go public next year. Though it is not clear if the public offering would be launched in India or in the US.
As per the deal between the two parties, a certain number of warrants was to vest with Nortel after each $5 million worth of OEM purchase from Tejas. In total 12,954 warrants was to vest with Nortel after its cumulative OEM purchase from Tejas hit the $50 million mark.
Tejas is a privately-owned company co-founded by Sanjay Nayak (CEO), Kumar Sivarajan (CTO) and Arnob Roy (VP Engineering). It is backed by investors, including serial entrepreneur and ace venture capitalist Gururaj Deshpande, and VC firms Battery Ventures and Mayfield. The other investors include US-headquartered Sycamore Networks, investment funds Sandstone Capital, Intel Capital and the Khemkas-owned Sun Group.
Punj Lloyd sells 11% stake
A clutch of private equity funds including Warburg Pincus, Blackstone, Avenue Capital and hedge funds DKR Oasis and Kingdom Capital have bought a total of 11 per cent stake in Punj Lloyd for Rs 814 crore.
Warburg Pincus has bought 5.5 per cent stake while, Avenue Capital has acquired 2.5-3 per cent in Punj Lloyd, which is an EPC contractor focused on the oil and gas sector with diversification to infrastructure.
Private equity major Blackstone bought somewhere between 0.5 per cent and 1 per cent in Punj Lloyd, which issued the shares to these global investors through a qualified institutional placement (QIP) issue priced at Rs 275 a share, almost on par with the current market price.
The deal propels the company’s valuation to nearly Rs 8,000 crore. Moore Capital bought 1-1.5 per cent stake in the Delhi-headquartered construction major.
The company issued 29.6 million shares through the QIP issue, managed by Citigroup Global Markets India and Kotak Mahindra Capital Company.
Following the placement, the company’s paid-up capital has gone up from Rs 29 crore. Ravi Keswani, director (finance) of Punj Lloyd said the company would invest Rs 400 crore to buy a strategic 25.1 per cent stake in Pipavav Shipyard and it would spend another Rs 80 crore for its foray into real estate development.
Warburg Pincus has bought 5.5 per cent stake while, Avenue Capital has acquired 2.5-3 per cent in Punj Lloyd, which is an EPC contractor focused on the oil and gas sector with diversification to infrastructure.
Private equity major Blackstone bought somewhere between 0.5 per cent and 1 per cent in Punj Lloyd, which issued the shares to these global investors through a qualified institutional placement (QIP) issue priced at Rs 275 a share, almost on par with the current market price.
The deal propels the company’s valuation to nearly Rs 8,000 crore. Moore Capital bought 1-1.5 per cent stake in the Delhi-headquartered construction major.
The company issued 29.6 million shares through the QIP issue, managed by Citigroup Global Markets India and Kotak Mahindra Capital Company.
Following the placement, the company’s paid-up capital has gone up from Rs 29 crore. Ravi Keswani, director (finance) of Punj Lloyd said the company would invest Rs 400 crore to buy a strategic 25.1 per cent stake in Pipavav Shipyard and it would spend another Rs 80 crore for its foray into real estate development.
Vedanta sells Sterlite Gold for $86m
Vedanta Resources, the Anil Agarwal-led mining major, has sold its 84.2% stake in Sterlite Gold to Georgia’s GeoProMining for $86 million. The Canada-listed Sterlite Gold’s main assets include gold mines in Armenia.
The deal comes a year after Vedanta acquired Sterlite Gold for around Rs 300 crore, a step believed to be in line with the LSE-listed group’s global ambitions. But problems with the local government are believed to have led to the group’s exit from Armenia.
GeoProMining had made an all-cash offer to Vedanta Resources at a price of $0.3845 per share of Sterlite Gold, amounting to $86 million. “In addition, GeoProMining has agreed to repay Sterlite Gold’s debt of around $25 million to Vedanta Group companies. The carrying value of Vedanta’s investment in Sterlite Gold was $83 million on June 30, 2007,”said a source.
Read more in The Economic Times article.
The deal comes a year after Vedanta acquired Sterlite Gold for around Rs 300 crore, a step believed to be in line with the LSE-listed group’s global ambitions. But problems with the local government are believed to have led to the group’s exit from Armenia.
GeoProMining had made an all-cash offer to Vedanta Resources at a price of $0.3845 per share of Sterlite Gold, amounting to $86 million. “In addition, GeoProMining has agreed to repay Sterlite Gold’s debt of around $25 million to Vedanta Group companies. The carrying value of Vedanta’s investment in Sterlite Gold was $83 million on June 30, 2007,”said a source.
Read more in The Economic Times article.
Future Capital, Pantaloon to part ways
Future Capital Holdings (FCH), the asset management and consumer credit business of Pantaloon Retail, is being spun off and separately listed on the bourses. It is learnt that Pantaloon Retail will seek approval for this move at its board meeting on Saturday.
UBS Investment has recently valued Future Capital at around $670 million (about Rs 2,700 crore). The move is a bid by Future Capital to raise money for expanding its chain of consumer finance outlets, unlock shareholder value and incentivise its talent through stock options. Kotak Mahindra is said to be the lead-manager for the issue.
When contacted, Future Group chief executive Kishore Biyani said: “We do not comment on speculation.” FCH CEO and managing director Sameer Sain also declined to comment. Pantaloon Retail till recently held a 74% stake in FCH, with the rest being held by co-promoter Sameer Sain and other senior employees such as Atul Kapur and Shishir Baijal. Six months ago, Och-Ziff Capital, a $27-billion hedge fund is also said to have picked up a 10% stake for an undisclosed amount.
The asset management business of Future Capital includes Kshitij (a $85-million domestic real estate fund), Horizon, a $350-million international real estate fund and Indivision, a $425-million private equity fund which invests in the consumer sectors and a $350-million hotel fund. The consumer credit business, Future Money, includes the personal lending business.
Read more in The Economic Times article.
Wednesday, August 15, 2007
IDBI Capital to sell 26% stake
IDBI Capital, a wholly owned subsidiary of IDBI Ltd, is planning to sell 26 per cent stake to a strategic foreign partner to boost its institutional broking business.
Sources said the company, which is into stock broking, internet trading, merchant banking and private equity, has held informal talks with foreign players and is finalising a merchant banker for the deal.
IDBI Capital could command a valuation of more than 4-5 times its net worth of Rs 350 crore. They also do not rule out the possibility of a higher stake sale (up to 49 per cent) depending on the valuation.
Bear Stearns, the biggest debt player in the US and the Australia-based Macquarie, who are keen on entering the Indian market, are two contenders for the stake purchase, said sources.
IDBI Capital is also into retail broking through its internet portal, corporate advisory and debt arranging & underwriting. It has a turnover of more than Rs 10,000 crore a year in the broking business. Last month, IDBI Capital increased its private equity corpus to Rs 150 crore.
Read more in The Business Standard article.
Saastra Software to raise $10 mn via venture capital
Saastra Software, a Bangalore-based software startup focused on solutions for the hospitality industry, is looking to raise around $10 million through venture capital.
The company recently announced the commercial launch of its product, which facilitates the automation of a hotel’s internal business processes like reservations, guest service operations and corporate client management.
Vishnu Murali Konduru, founder-CEO of Saastra Software, said he was in talks with a couple of venture capitalists and also a strategic player in the Asian region.
Saastra is delivered as software as a service and its architecture makes it possible for the users to expose their automated inventory to the consumers, eliminating the need for third party intermediaries.
Read more in The Business standard article.
The company recently announced the commercial launch of its product, which facilitates the automation of a hotel’s internal business processes like reservations, guest service operations and corporate client management.
Vishnu Murali Konduru, founder-CEO of Saastra Software, said he was in talks with a couple of venture capitalists and also a strategic player in the Asian region.
Saastra is delivered as software as a service and its architecture makes it possible for the users to expose their automated inventory to the consumers, eliminating the need for third party intermediaries.
Read more in The Business standard article.
ICICI raises Rs 1,294 cr via green-shoe option
ICICI Bank has raised Rs 1,294 crore through its green-shoe option in the local market. The bank had raised Rs 8,750 crore through its local issue and an equal amount through its overseas issuance, too.
The bank was looking at a green-shoe option of Rs 1,312.5 crore. These shares were also meant to be used for stabilisation purposes, to stabilise the shares in the market.
However, the bank has used only around Rs 18.5 crore for stabilising its shares. The bank had earlier priced its local issue at Rs 940. However, for retail shareholders, the bank had given a discount of Rs 50 per share.
The share price of the bank in the past two weeks has fallen much below the issue price. It closed on Tuesday at Rs 877.65. In the overseas market, the bank had priced its ADS at $49.25 or Rs 1,002.5 per share. The ADR price is currently at $43.
Tuesday, August 14, 2007
State-Run Power Finance Corp In Talks With Goldman, Blackstone For $1-B Fund
The Indian government-owned Power Finance Corp (PFC) plans to launch a private equity fund for investing in the domestic power sector. PFC is reportedly in talks with leading investment bankers including Goldman Sachs for raising the fund. The fund, which is expected to have $1 billion in corpus, is intended to support the last-mile equity requirement of power projects.
The fund is likely to be registered in overseas tax havens like Mauritius, Cyprus or Isle of Mann to get maximum tax benefits for the investors and encourage them to increase exposure to the power sector.Mauritius is apparently the first priority for the company.
All the approvals from the power and finance ministries have been obtained and the company may announce the fund later this month, the report adds. The power sector needs a about $250 billion investment, while it needs at least $75 billion in equity support.
The fund is likely to be registered in overseas tax havens like Mauritius, Cyprus or Isle of Mann to get maximum tax benefits for the investors and encourage them to increase exposure to the power sector.Mauritius is apparently the first priority for the company.
All the approvals from the power and finance ministries have been obtained and the company may announce the fund later this month, the report adds. The power sector needs a about $250 billion investment, while it needs at least $75 billion in equity support.
Lehman acquires Brics' institutional business
Lehman Brothers, the fourth largest securities firm in the US, has clinched the deal to buy institutional broking business of Mumbai-based Brics Securities.Sources said Lehman Brothers is likely to disclose the new acquisition to the regulators in the US, where it is listed, later this week .
Brics Securities was created in October 2003 after the acquisition and rechristening of Birla Sun Life Securities - a joint venture between the Aditya Birla group and the Sunlife Group of Canada.
Brics Securities, the financial services arm of J V Gokal Group, is one of the top-ranked brokerage houses in India, catering to high networth clients. Post-deal, the research team, headed by Prabhat Awasthi and his 21-member institutional team, institutional sales (8 members) and derivatives sales (12 members) will be move to Lehman Brothers.
The sources said Brics Securities, which recently hired Rahul Rege from Sharekhan to head the retail business, will expand the retail brokerage business in the coming years.
Read more in The Business Standard article.
Brics Securities was created in October 2003 after the acquisition and rechristening of Birla Sun Life Securities - a joint venture between the Aditya Birla group and the Sunlife Group of Canada.
Brics Securities, the financial services arm of J V Gokal Group, is one of the top-ranked brokerage houses in India, catering to high networth clients. Post-deal, the research team, headed by Prabhat Awasthi and his 21-member institutional team, institutional sales (8 members) and derivatives sales (12 members) will be move to Lehman Brothers.
The sources said Brics Securities, which recently hired Rahul Rege from Sharekhan to head the retail business, will expand the retail brokerage business in the coming years.
Read more in The Business Standard article.
Indian Hotels to raise Rs 1,900 cr
Indian Hotels Company Ltd, the Tata group firm that operates the Taj chain of hotels, has decided to collect around Rs 1,700-1,900 crore through two rights issues to meet its long-term requirement for capital for expansion, including acquisitions.
The company will raise Rs 844 crore through a rights offer for equity shareholders, while it will mop up Rs 900-1,080 crore through a similar offer for unsecured convertible debenture-holders. The exact size of the fund collection through the rights offer of debentures will be determined at the time of the issue.
The company will offer one rights share to shareholders for every five shares they hold. The offer will be priced at Rs 70 apiece. Debenture holders will get one debenture for every 10 they hold. The debentures will carry a coupon rate of 4 per cent for five years. The debentures can be converted after two years at a price of Rs 150-180 apiece.
Earlier this month, the shareholders of Indian Hotels Company passed a resolution to bring down the limit of foreign institutional investors’ (FIIs’) holding in the company from 40 per cent to 30 per cent. FIIs currently hold 23.4 per cent and the promoters, 29 per cent. The company’s equity capital stands at Rs 60.29 crore.
Read more in The Business Standard article.
The company will raise Rs 844 crore through a rights offer for equity shareholders, while it will mop up Rs 900-1,080 crore through a similar offer for unsecured convertible debenture-holders. The exact size of the fund collection through the rights offer of debentures will be determined at the time of the issue.
The company will offer one rights share to shareholders for every five shares they hold. The offer will be priced at Rs 70 apiece. Debenture holders will get one debenture for every 10 they hold. The debentures will carry a coupon rate of 4 per cent for five years. The debentures can be converted after two years at a price of Rs 150-180 apiece.
Earlier this month, the shareholders of Indian Hotels Company passed a resolution to bring down the limit of foreign institutional investors’ (FIIs’) holding in the company from 40 per cent to 30 per cent. FIIs currently hold 23.4 per cent and the promoters, 29 per cent. The company’s equity capital stands at Rs 60.29 crore.
Read more in The Business Standard article.
Aegis acquires Hindustan Aegis's gas terminal
Aegis Logistics Ltd has acquired the throughput activity undertaking of Hindustan Aegis LPG Ltd. Upon approval of the scheme, one share of Aegis Logistics will be issued for every three Hindustan Aegis shares held. This will increase paid-up capital of Aegis to Rs 19.91 crore from Rs 16.31 crore.
Hindustan Aegis is promoted by Vitol SA, one of the world's largest independent oil and gas trading companies and the KM Chandaria Group. It has a gross asset base of over Rs 100 crore comprising 20,000 metric tonne gas terminal and related facilities.
The acquisition of gas terminal is to support the company's rapidly growing retail network of auto LPG stations, Aegis Autogas, in the country.
Aegis Logistics has also been allotted a suitable plot of land by Haldia Dock, Kolkata Port Trust to expand its core business of liquid logistics. This will be the third port after Mumbai and Kochi where Aegis will have operations.
Hindustan Aegis is promoted by Vitol SA, one of the world's largest independent oil and gas trading companies and the KM Chandaria Group. It has a gross asset base of over Rs 100 crore comprising 20,000 metric tonne gas terminal and related facilities.
The acquisition of gas terminal is to support the company's rapidly growing retail network of auto LPG stations, Aegis Autogas, in the country.
Aegis Logistics has also been allotted a suitable plot of land by Haldia Dock, Kolkata Port Trust to expand its core business of liquid logistics. This will be the third port after Mumbai and Kochi where Aegis will have operations.
Monday, August 13, 2007
IFCI invites bids for 26% stake sale
IFCI today kicked off the process to sell 26% stake to a strategic investor.The Delhi-based financial institution today invited expressions of interest (EoI) from domestic and foreign investors for the stake. The deadline for the EoIs is September 14, 2007.
IFCI will follow a two-stage process for selection of the investor by end-January, 2008.
In the EoI stage, IFCI will announce the names of qualified investors on September 25.In the proposal stage, the financial institution will issue a request for proposal to the qualified investors in mid-October.
The due date for financial and technical bid submission will be end-November, 2007. Subscription and allotment of shares to the selected investor will be end-January next year.
Read more in The Business Standard article.
Shapoorji Pallonji realty targets $300m from PEs
HDFC Realty, Citigroup and Government of Singapore Investment Corporation (GIC), among others, are set to pump $300 million into Shapoorji Pallonji Group’s realty business.
Sources said the deal—amongst the biggest private-equity plays in the Indian real estate sector—was imminent and might also involve a few more investors. It is believed that PEs could pick 15-20% stake in the recently-created holding entity of the group’s realty venture.
The Mumbai-based 140-year-old construction group is developing real estate worth about $2 billion across India. The group’s realty arm is managed by Shapoor Mistry, the elder son of Pallonji Mistry, among the wealthiest Indians.
These projects are mostly FDI-compliant and located at prime areas, which will attract substantial premium. It is also working on over 10 real estate projects in Mumbai, Pune, Hyderabad, Chennai, Kolkata, Delhi, Nagpur and Mysore.
Sources said the deal—amongst the biggest private-equity plays in the Indian real estate sector—was imminent and might also involve a few more investors. It is believed that PEs could pick 15-20% stake in the recently-created holding entity of the group’s realty venture.
The Mumbai-based 140-year-old construction group is developing real estate worth about $2 billion across India. The group’s realty arm is managed by Shapoor Mistry, the elder son of Pallonji Mistry, among the wealthiest Indians.
These projects are mostly FDI-compliant and located at prime areas, which will attract substantial premium. It is also working on over 10 real estate projects in Mumbai, Pune, Hyderabad, Chennai, Kolkata, Delhi, Nagpur and Mysore.
Fidelity acquires 7% in TCI for Rs 53 cr
Fidelity Investments International has picked up a 7% stake in Transport Corporation of India (TCI), the Delhi-based express logistics company, for Rs 53 crore. TCI will issue equity shares of Rs 2 face value to Fidelity Investments at Rs 105.25 per share, in accordance with Sebi guidelines for preferential issue.Post-issue, Fidelity’s stake in TCI would increase to nearly 10% of the paid up equity.
TCI’s executive director Vineet Agarwal said: “The amount raised will be utilised to fund the expansion of TCI, specifically for building capacity in the warehousing space and setting up information technology (IT) systems.” Earlier, in 2006, TCI had announced expansion plans requiring Rs 450 crore of investments in warehousing, fleet upgradation and expansion, shipping and IT systems.
TCI intends to raise another Rs 60-70 crore through sale of equity in the following year. “Our plan was to raise almost Rs 120 crore in two stages through equity dilution. The first stage has been completed. We will raise another Rs 70 crore within six to nine months,” said Mr Agarwal. The company claims it has already invested Rs 100 crore for expansion in FY07 and would be looking at investing another Rs 200 crore in the current fiscal.
Read more in The Economic Times article.
TCI’s executive director Vineet Agarwal said: “The amount raised will be utilised to fund the expansion of TCI, specifically for building capacity in the warehousing space and setting up information technology (IT) systems.” Earlier, in 2006, TCI had announced expansion plans requiring Rs 450 crore of investments in warehousing, fleet upgradation and expansion, shipping and IT systems.
TCI intends to raise another Rs 60-70 crore through sale of equity in the following year. “Our plan was to raise almost Rs 120 crore in two stages through equity dilution. The first stage has been completed. We will raise another Rs 70 crore within six to nine months,” said Mr Agarwal. The company claims it has already invested Rs 100 crore for expansion in FY07 and would be looking at investing another Rs 200 crore in the current fiscal.
Read more in The Economic Times article.
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