MCX to hit market with Rs 600-cr IPO

The largest commodity futures bourse in the country - Multi Commodity Exchange of India (MCX) - is all set to hit the primary market with an initial public offering (IPO). The commodity exchange is likely to announce its long-awaited IPO within a week. Sources said, MCX would sell 10% stake, through a mix of fresh shares and an offer for sale, to raise around Rs 500-600 crore.

According to sources, fresh shares will contribute the majority of the offering while the offer for sale will account for 2-3%. An offer for sale refers to the sale of promoter's existing equity to the public. The bourse has been valued at around $1.2-1.3 billion. The issue is being managed by DSP Merrill Lynch, Kotak Securities and Enam Financial. MCX has been mulling over listing on local bourses for the past two years.

Sources said, IPO would provide many of its Indian and foreign investors an exit route. Around 24% of MCX is owned by foreign investors. While Fidelity holds 9%, Merrill Lynch and Citi own 5% each. The other investors include US-based Passport Capital (3%) and the UK-based fund GLG (2%).

Read more in The Economic Times article.

R Systems to acquire Sento Europe

R Systems International, an outsourcing firm, is set to acquire Sento Europe B.V., a Netherlands corporation and Sento S.A.S., a French corporation (collectively known as Sento Europe) from Sento Corporation, US.

The transaction is subject to contracts and corporate and regulatory approvals and it is anticipated that the transaction will be completed before January 15, 2008, said a release issued by the company.

Sento Europe has operations in Enschede, Netherlands and Metz, France. The company provides integrated technical support and customer care services through multiple channels in 16 European languages. Sento Europe primarily focuses on the technology sector and amongst its clients are the world's leading consumer electronic companies. The company achieved revenues of approximately $14.85 million during the year ended March 2007.

DLF to list 5 Units

Real estate major DLF plans to raise $5 billion over the next three years by listing five of its business units, including DLF Homes, DLF Retail, DLF Hotels, DLF Utilities and DLF Infrastructure. There are no plans to further dilute equity in group flagship DLF. The eventual strategy is to make DLF a holding company with considerable equity stakes in the listed entities in addition to being an incubator for new businesses.

In all, the company is looking at a fund infusion of $10-12 billion in its various businesses over the next three years.The $5-billion group will raise the fund through domestic IPOs in addition to Singapore listing of DLF Assets (DAL)(Related story), the company which own the office space development and management business of the group. At present, the company is awaiting regulatory approvals for this IPO.All other business units of the company are expected to be listed in Indian capital markets only.

Read more in The Economic Times article.

Pvt equity firms line up cash for Nazara

Nazara Technologies, the Mumbai-based mobile entertainment provider and online gaming firm, is inching closer to get a second round of funding from two private equity firms in early January.An industry source in know of the development said that two overseas PE firms, including Sequoia Capital will invest around $7 million in Nazara.

It has been learnt that Sequoia deal has been sealed and Nazara will make an official announcement on January 7, though promoter and chief executive officer of Nazara Technologies Nitish Mittersain declined to comment anything at this stage.

“Margins in the cricket and gaming are as high as 40% compared to other space like music, ringtones where it’s around 5%. We have targeted the mobile value-added services space in a big way,” Mittersain added.

Nazara had got first funding of $1.5 million from Sequoia Capital.Sequoia Capital has investments in Mauj ($10 million), Bharti Telesoft ($12 million), Nazara ($2 million), Bubbly Motion ($10 million).

According to Associated Chambers of Commerce and Industry of India, a reduction in basic customs duty from 10% to 5% and elimination of additional customs duty could enhance India’s current share of 0.25% in the $30 billion global market to 3% by 2010.

Read more in The DNA Money article.

Vivimed lab close to buying German firm

Hyderabad-based Vivimed Laboratories, a business-to-business speciality chemical and pharmaceutical manufacturer, is close to buy the cosmetics and related ingredient manufacturing division of a German multinational specialty chemical and pharmaceutical company.According to sources Vivimed will add to its fold three units of the German company, located in Germany.

The three units, which include a research and development centre, currently manufactures about 45 products with a turnover of $30-40 million. Vivimed was negotiating with the German company since last year to take over the brands, existing business and intellectual property rights of that division, they said.

Read more in The Business Standard article.

UB group ups stake in Deccan Aviation by 3%

UB group has increased its stake in low-cost airline firm Deccan Aviation by almost 3% through market purchases, stock exchange data showed on Wednesday.UB group firm Kingfisher Radio, that runs Kighfisher Airlines, purchased a total of four million shares (2.95%) on Wednesday on BSE and NSE combined at Rs 275 each.Most of the shares were purchased from Money Matters Advisory and Money Matters (India), according to the BSE and NSE data.

With these purchases, Kingfisher Radio and other group companies of UB group have increased their stake to almost 49%.In September, UB group had made an open offer to the shareholders of Deccan Aviation at Rs 155 a share for a 20% stake.Last week, Deccan Aviation had announced it would merge the airline operations of Kighfisher Airlines with it.

Spice to sell telecom towers to Srei

Mobile services provider Spice Communications is set to sell its tower arm to Srei Infrastructure. The deal is estimated to be worth around Rs 500 crore. Following the deal, the towers from Spice may be added to Srei’s subsidiary Quipo Telecom, a stand-alone tower company.

Spice has also said that it was availing loans for up to $400 million from Hong Kong & Shanghai Banking Corp and another $410 million from China Development Bank for expanding its networks in Karnataka and Punjab, the two circles where it currently offers mobile services.

Read more in The Economic Times article.

SBI to absorb 6 associates by Mar ’09

SBI chairman O P Bhatt, who had convened the meeting of six associate banks of SBI at its Nariman Point office, made it clear that he wanted nothing less than a “bullet” merger — all the six associates, three of which are listed entities, should be fused into the mothership in one shot, before March 31, 2009.

He was insistent because separate integration exercises — as was done in the case of State Bank of Saurashtra, which ceases to be an entity on January 26, 2008, — would be extremely cumbersome, gargantuan and mind-numbing considering the complexity of manoeuvres needed to keep the 3.3 lakh combined employees happy.

The boards of the SBI and the six associates will now hold a meeting on January 25 to give their in-principle nod to the merger.The finance ministry and the Reserve Bank of India are expected to give their green signals.The goal is to have a common balance-sheet as on March 31, 2009, said an SBI official in the know.

That’s important because India will open its doors fully to foreign banks by then. The size of operations of the foreign banks could dwarf the domestic players, which is why the government has been at pains to encourage consolidation.

Read more in The DNA Money article.

India Inc to have easier M&A ride

The government has decided to simplify the norms for mergers and acquisitions by removing the bottlenecks that slow down India Inc’s inorganic growth. The idea is to offer a fast-track system which will spare companies from the lengthy process of securing high court sanctions for M&As, if they meet certain criteria.

The ministry of corporate affairs is working on two types of fast-track clearances for M&As. The first one is a new concept called ‘contractual mergers’. Under this, companies needn’t wait for the high court approval, which will take at least six months to materialise.

This proposal, originally mooted by a panel headed by eminent lawyer Shardul Shroff and later endorsed by the JJ Irani panel on company law, will get legal recognition soon, officials said. The second proposal is a simplified procedure for M&As between group companies and unrelated private companies.

Under the contractual merger plan, companies can decide to merge through a contract which should be approved by the shareholders later. Such a window is available in many other countries. Currently, all private sector companies need to get the approval of high courts for M&A activities, while state-run companies have to obtain the government approval.

Read more in The Economic Times article.

Future Capital picks up 28% in Sankalp Stores

Future Capital, the financial arm of Future Group, has picked up an estimated 28% stake in Sankalp Retail Value Stores, a franchisee of the US-based discount format, My Dollarstore. The discount format will now be a part of Pantaloon Retail’s larger strategy to set up imported bazaar concessions as a shop-in-shop concept in its hypermarket, Big Bazaar.

A team of Big Bazaar is working on setting up the new format which will offer a huge array of imported products at reasonable rates. Anil Biyani, Kishore Biyani’s younger brother, is likely to be in charge of imported bazaar, sources said. The format is also expected to help scale up the profit margins in Big Bazaar.

Read more in The Economic Times article.

Merrill Lynch may pick 20% stake in Sharekhan

Private equity(PE) investor Citigroup Venture Capital (CVC) is diluting a part of its 75% stake in brokerage firm Sharekhan. Financial services major Merrill Lynch is said to be the front-runner to pick a minority stake even as other PE firms, including Baring Private Equity, are believed to be in the race.

The industry buzz is that the deal for 20% stake is valued at around Rs 300 crore. However, a source close to Sharekhan said CVC is looking to dilute its stake only by 10% and the deal value is close to $50 million or Rs 200 crore.

This will put Sharekhan’s total value at Rs 1,500-2,000 crore, a jump of around 100% in seven months. CVC along with IDFC had picked 85% in Sharekhan in May this year for Rs 650-700 crore, pegging the valuation at around Rs 800 crore.

Read more in The Economic Times article.

Bharti eyes Big Apple as starter for retail feast

Bharti Enterprises, slated to start its retail business in the first quarter next year, may acquire Big Apple — the Delhi-based supermarket chain with 65 stores. Bharti’s acquisition blueprint in the retail sector may be a replay of its telecom business, where the group built up a pan-India mobile presence by acquiring telcos such as JT Mobile in Karnataka and Andhra Pradesh, Skycell in Chennai and Hexacom in Rajasthan.

A senior source said the Bharti Group and Big Apple are at fairly advanced stages of negotiations and if price expectations match, the deal could be sealed as early as next month. He also said Big Apple has quoted its price and Bharti has given a revised offer.

Read more in The Economic Times article.

Australian co may buy controlling stake in Sharepro

Australia-based Link Market Services, a provider of registry services and technology to financial market participants in Australia, is learnt to be in an advanced stage to pick up controlling stake in Mumbai-based Sharepro Services.

The deal, pegged at around $10 million and likely to be sealed within a month, is yet another example of the interest among foreign capital market intermediaries to build a presence in the Indian capital market.

Sharepro Services is a Sebi-registered category-I registrar and securities transfer agent with depository connectivity for both NSDL and CDSL. Sharepro Services CEO Chhaya Shah confirmed that talks were on.

According to sources, the Australian company is keen on picking up a controlling stake of over 51% in Sharepro. The two companies are also learnt to have agreed to let the current management run the daily operations.

Read more in The Economic Times article.

IFCI stake sale called off !

IFCI, India’s oldest financial institution saddled with bad loans, today called off its stake sale plan after marathon talks with the Sterlite-Morgan Stanley combine ended in disagreements over the price and management control.

A press release from IFCI said since the bid was made on the condition that the consortium would take over the management of the company, it was decided not to proceed with it.According to sources close to the development, the Sterlite-Morgan Stanley consortium was offered management control at Rs 145 a share, which it did not accept.

IFCI then quoted Rs 111 apiece with three of the eight board seats. The bidders, however, insisted on five board seats at this price. At this point, the deal was called off.

Read more in The Business Standard article.

Manappuram receives Rs 70 crore funding

Manappuram General Finance and Leasing (MAGFIL), the flagship company of the Manappuram Group has arranged a fund infusion of Rs 70 crore from Sequoia Capital and India Equity Partners (IEP).

Sequoia Capital and IEP will invest Rs 35 crore each in two tranches to bankroll Manappuram’s expansion plans for MAGFIL and other group companies.MAGFIL, the BSE-listed non-banking finance company, which is the flagship of the Manappuram Group, had earlier this month finalised the raising of Rs 46.80 crore in working capital from Sequoia and Hudson Equity Holdings, an investment vehicle of IEP, a $300-million private equity fund.

Read more in The Business Standard article.

VCs ready to finance carbon credit business

The Indian carbon sector is getting hot. Venture capital firms are making a beeline to set up exclusive carbon funds for clean development projects (CDM) which have the potential to generate carbon credits.

Kick-starting the process is IFCI Venture Capital Fund, which is planning to float Green India Venture Fund with a corpus of around euro 50 million, to begin with. The fund could be raised to euro 100 million once a partner is roped in.

Read more in The Times of India article.

ICICI Ventures may exit Dr Reddy's R&D unit

ICICI Venture Funds and Citigroup Venture Capital are likely to pull out their investment in Dr Reddy’s Laboratories’ drug research company, Perlecan Pharma, on concerns over the commercial viability of its experimental drugs. The two investors have begun talks with Dr Reddy’s to sell their stake for their initial investment of $26 million plus interest.

Perlecan Pharma started in September 2005 with four new chemical entities from the Dr Reddy’s stable and has the first right of refusal for further discoveries by the Hyderabad-based company. However, the company this year abandoned the development of a new drug code-named DRL 11605, aimed at treating diabetes and obesity. Perlecan’s pipeline is now left with three molecules: DRF 10945, a molecule targeted at metabolic disorders, currently in phase II of clinical trials, RUS 3108, a cardiovascular drug in phase I, and finally DRL 16536, an anti-diabetic drug in late pre-clinical studies.

Read more in The Economic Times article.

NYSE, Nymex line up to buy stake in MCX

The New York Stock Exchange (NYSE) and the New York Mercantile Exchange (Nymex) are awaiting policy guidelines on foreign direct investment (FDI) in commodity exchanges to pick up minority stake in Multi Commodity Exchange of India (MCX). The guidelines may be announced on Friday.MCX, the largest commodity futures bourse, is promoted by the Mumbai-based Financial Technologies (FTIL).

When contacted an MCX spokesperson said that the exchange has been long awaiting the government policy on foreign investments. While the transaction value under discussion is not clear, sources say that it could be in line with the previous stake sale. Last week, FTIL offloaded around 10% stake in MCX. ICICI, IL&FS and Kotak acquired 3.55%, 5%, 1% stakes, respectively, at an enterprise value of $1.1 billion (around Rs 4,400 crore). With this, FTIL's holding in MCX has come down to 37.5%.

MCX and National Commodity & Derivatives Exchange (NCDEX), which run two leading national commodity bourses, have been pioneers in attracting foreign investors. While Fidelity had picked up 9% in MCX, Goldman Sachs had bought 8% in NCDEX. NCDEX had later sold 7% to Inter-Continental Exchange (ICE) as well.

Read more in The Economic Times article.

Merrill Lynch buys 13% in mining co

Merrill Lynch International has picked up a 12.74% equity stake in mining firm Resurgere Mines & Minerals India for an undisclosed amount. Formerly known as Exfin Shipping (India), Resurgere has interests in extracting, processing and selling mineral products and also in exploration and development of mining assets.

In a bid to fund the purchase of plant and machinery to set up its extraction and crushing facilities at mines, it is in the process of tapping the capital markets. The company also plans to buy railway rakes to set up its logistics infrastructure facilities from the capital raised.

Resurgere currently operates in Kendujhargarh and Mayurbhanj districts of Orissa and has plans to start operations in Jharkhand’s Singhbhum district soon. It has entered into an arrangement with a leaseholder in a mining area in west Singhbhum district for mining iron ore and supplying the entire production.

All three mines carry high-quality iron ore of about 62-64% ferrous content. Resurgere sells most of its products domestically, except for iron ore fines, which it exports to China.

Dell may sell its BPO biz

Intelenet and Blackstone seem to have joined the race to acquire Dell’s non-US BPO business, which is on the block.Interestingly, even as Dell maintains that it was not contemplating any such move, sources said that Intelenet (which was recently acquired by Blackstone) and Blackstone itself as a standalone buy-out fund have evinced interest in acquiring the unit. Besides, these two, the other names going around in the market are Wipro and Accenture which have shown interest to acquire the PC makers unit.

Sources said the world’s second-largest PC maker has put its contact centres across India, Philippines, El Salvador in South America and Canada on the block. The valuation of the business could be anything upwards of $3 billion, sources said.

Read more in The Times of India article.

RCom completes takeover of Yipes Holdings

Anil Ambani group company Reliance Communications today said it has completed the acquisition of US-based Yipes Holdings in an deal valued at around Rs 1,200 crore.The acquisition, which was announced in July this year, would give the company access to a Rs 4,00,000 crore global enterprise data market, RCom said in a statement.

It has received all necessary approvals from the US Federal Communications Commission (FCC) for the transfer of control of Yipes, the statement added.Yipes has strategic network presence in the top 14 US metros, which account for 40% of the total US datacom market and also has nearly 1,000 enterprise customers.

The company would expand Yipes presence to 40 new markets globally including Middle East, Asia and India. By synergizing Flag and Yipes, Reliance is poised to become the global leader in Ethernet, which is expected to reach Rs 1,00,000 crore ($25 billion) market by 2010, it said.

Related Post:
Flag Telecom buys US-based Yipes for $300mn

Vivimed Labs nears buys in US, Europe

Hyderabad-based Vivimed Labs is close to acquiring two speciality chemical companies in the US and Europe.It will pay $40 million for the European company and $25 million for the other.

Vivimed will acquire only the brands, intellectual property and customers of the company. Manufacturing assets and employees will remain in the parent company. The European company is expected to add over 10% to the revenues in the first year of operations. Vivimed will integrate the company with its Indian operations by shifting manufacturing to the country.

Read more in The DNA Money article.

Sequoia, Singapore fund may invest in Excelsoft

Sequoia Capital and a Singapore-based private equity fund are learnt to be in the race to invest upwards of Rs 100 crore in Mysore-based e-learning firm Excelsoft.Excelsoft is a six-year-old firm which provides a range of customised learner-centric learning systems, test and assessment systems, and desktop tools.

According to industry information, the company, which has a topline of around Rs 50 crore is expected to be valued in the range of Rs 350-400 crore for the stake sale. A deal is expected to be sealed by early-January 2008.

Industry sources further indicate that in addition to Sequoia and the Singapore fund, ICICI Venture is also in the fray to invest in this high-margin firm.

Read more in The Business Standard article.

3 Indian cos bid for Singapore power giant

Three domestic power companies — Reliance Energy, Tata Power and GMR Infrastructure — have submitted indicative bids to acquire Singapore-government owned Tuas Power.

While Tata Power and Reliance Energy have decided to bid on their own, Bangalore-based GMR Infrastructure has formed a consortium with Macquarie Bank and Kuwait Fund for the purpose.The price tag for the foreign asset could be at around $2 billion (Rs 8,000 crore).The domestic power majors submitted their bids today, which was the last date of submission of indicative bids.

Industry sources said other interested parties include Hong Kong's China Light & Power, Hongkong Electric, Japan's Marubeni, Singapore's SembCorp Industries, Tokyo Electric Power Co, Australia's Babcock & Brown, General Electric and International Power Plc of the UK.

Read more in The Business Standard article.

US fund to pay Rs 501 cr for 5% in Rel Cap

Eton Park, a US-based hedge fund managing over $10 billion worldwide, is buying a 5% stake in Reliance Capital Asset Management for Rs 501 crore. This values the mutual fund at Rs 10,000 crore or 13% of assets under the fund’s management. RCAM will use the proceeds from the stake sale to expand its domestic and international operations, a company press release said, adding that the transaction was expected to be finalised in January 2008.

Reliance Capital said the valuation of the mutual fund arm, following the proposed investment by Eton Park, translates into Rs 400 per share of Reliance Capital. Eton Park was formed in 2004 by three former Goldman Sachs executives.

Read more in The Economic Times article.

Goldman values Tejas at $625 million

Tejas Networks, the Rs 240 crore Bangalore-based optical networking firm which makes proprietary boxes for transmitting data for telecom carriers, has been valued at Rs 2,400 crore ($625 million) by Goldman Sachs when it recently invested around Rs 95 crore.The investment by Goldman Sachs in the firm takes the total private equity investments in the company to Rs 280 crore ($73 million).

Tejas is aiming to go public next year and its valuation is expected to be close to Rs 3,200 crore ($800 million), when it will have a topline of around Rs 400 crore.
According to industry information, around 10-15 per cent is expected to be offloaded, with Tejas raising around Rs 300 crore in the process. Tejas Networks offered not to comment on the valuation by Goldman Sachs.

Other private equity investors, include Sandstone, Intel Capital. Mayfield Ventures, Battery Ventures, SUN Group of the Khemkas, besides ASG Omni. IL&FS Venture was among the early investors who have exited the firm. Tejas has Silicon Valley billionaire entrepreneur Gururaj Deshpande as its mentor and early-stage investor, besides his company Sycamore, also has an exposure.

Tejas Networks is among the few homebred firms focussing heavily on the Indian markets and counts almost all telecom service providers among its customers.

Read more in The Business Standard article.

Welspun sewing another European buy

Some 16 months after its first European buy, Welspun India is close to acquiring another home furnishings and textile firm in the continent as it tries to reduce dependence on the US market and combat the rupee’s appreciation against the dollar.

The company is likely to announce the deal, which is estimated to be in the range of Rs 80-100 crore, by the end of this month. The name of the company it buying and other details were not disclosed.However, Akhil Jindal, president, Welspun India, denied any such plans. Welspun acquired Christy, the UK’s largest terry towel brand, in July 2006.

The flagship company of Rs 2,500 crore Welspun Group exports products mainly to the US; 70% of its revenues comes from exports of which Europe contributes only 5%.Welspun is among the top four terry towel manufacturers in the world and accounts for 30% of the country’s terry towel exports to the US and 8% of the US imports of terry towel.

It is a vertically integrated company with activities starting from cotton farming to branding and retailing. It is one of the largest exporters of terry towels in Asia, exporting products to global companies like Costco, Wal-Mart, Kohls, Target, Springs, Nautica and Umbra.

Read more in The DNA Money article.

Nicco Corp to form JV with Italy-based Prysmian group

Electrical cable manufacturer Nicco Corporation today said it will set up a joint venture company with Italy's Prysmian group to cater to the Indian cable market.

Prysmian, a global player in energy and telecommunications cables industry, would hold about 60 per cent stake, while Kolkata-based Nicco corporation would pick up 40 per cent stake in the JV company.

Prysmian (Dutch) Holdings BV, a subsidiary of Prysmian group, has signed a definitive agreement with Nicco Corporation to set up the said JV, Nicco Cables Ltd, the company said in a filing to the Bombay Stock Exchange.

Essar Power to divest 10% to PEs for $700 m

The Ruia-controlled Essar Power (EPL) is offloading 10% stake to private equity (PE) investors to raise up to $700 million. The equity of the company is valued at $7 billion, sources said.

Essar Power currently operates power plants with a capacity of 1,200 MW and has drawn up an investment plan of over $4 billion to set up three more projects with cumulative capacity of 3,600 MW. The projects are coming up in Gujarat, Madhya Pradesh and Jharkhand and are expected to be funded on the basis of debt-equity of 3:1. The company has drawn up plans to set up projects of about 6,000 MW capacity.

The Indian power sector is attracting a lot interest from international investors. Projects with fuel linkages fetch attractive valuations. As Essar Power has developed capabilities in setting up mega power projects, the investors are eyeing the company as a potential investment target, said industry analysts.

Vatika sells 10% to 3 PE funds

Vatika Group, a Delhi-based realty firm, has divested 10.75 per cent for raising $250 million (Rs 1,000 crore) as private equity investments from Wachovia Bank, Baer Capital and Goldman Sachs. The deal estimates the valuation of the privately held Vatika at around Rs 9,302 crore.This is the first private equity investment in Vatika, which is planning its maiden public issue in 2009.

Vatika’s valuation at Rs 9,302 crore is higher than the market capitalisation of some listed bigwigs such as Bangalore-based Sobha Developers (Rs 6,269 crore) and Purvankara (8,284 crore); its Delhi peers such as Parsvnath Developers (Rs 6,398 crore), Omaxe (Rs 7,111 crore) and AnantRaj (Rs 8,557 crore) and the Mumbai-headquartered companies such as Akruti City (Rs 7,705 crore).

Read more in The Business Standard article.

Bharti arm to buy Jataayu for $20 mn

Bharti Telesoft is close to acquiring the Bangalore headquartered Jataayu Software, a provider of technology solutions for the mobile handset and value added services (VAS,), for an estimated $20 million.

Sources said Bharti Telesoft, the VAS arm of mobile telecom player Bharti Enterprises, has already entered into an initial agreement with Jataayu and an announcement is likely to be made shortly.

It was widely reported that Jataayu was close to a sell-off. It is believed that Bharti Telesoft was in talks with Jataayu for several months and now has an agreement in place eventhough the latter received proposals from others including overseas suitors.

Read more in The Economic Times article.

Valuemart Info buys 74% stake in Datatalk

Valuemart Info Technologies, an information technology and business process outsouring company, has acquired a 74 per cent stake in Bangalore-based IT-BPO company, Datatalk Services (India) Pvt Ltd, for an undisclosed amount.The acquisition will partly be funded by money raised earlier this year by Valuemart through a preferential issue.

Datatalk will become a subsidiary of Valuemart. The acquisition will help the company acquire premium clients and broadbase its services in the BPO segment.Valuemart offers ERP and business process management solutions, with focus on banking, financial services, insurance, legal and manufacturing verticals.

Shaw Wallace to merge with UB Group

The Rs 4,000 crore United Spirits will be merging Shaw Wallace with itself. United Spirits, a part of the UB Group, had acquired Shaw Wallace for around Rs 1,300 crore in mid-2005 .

UB Group President and Chief Financial Officer Ravi Nedungadi said that the merger would begin soon. The move will add another Rs 60 crore to United Spirits’ bottomline of close to Rs 500 crore and around Rs 350 crore to the topline.He also said that Whyte & Mackay, which was recently acquired for around $1.2 billion, would stay on as a subsidiary.

United Spirits is currently the third-largest distiller in the world with sales of over 66 million cases powered by 15 millionaire brands. Brands from Shaw Wallace, which operate in the volume segment, have contributed to this growth.

Read more in The Business Standard article.

DE Shaw to invest $60 mn in Gemini Inds

DE Shaw, one the largest global providers of alternative assets, is investing close to $60 million (Rs 240 crore) in Gemini Industries and Imaging, Chennai, one of the oldest media houses in the country.

The Gemini Group has its interests in film production, equipment hiring and lab processing for the motion picture business.The group has over 75 per cent market share in the equipment hiring business and over 50 per cent market share in the processing lab business for motion picture across Tamil, Telugu and Malayalam film industries.

The Gemini group equipped with this equity infusion, plans to set up the exhibition business in Tamil Nadu and Andhra Pradesh over the next 24 months.The first of 11 multiplex screens will kick start their operations by the end of 1st quarter of 2008 in Chennai. By 2011 they are expected to control over 300 screens.

Read more in The Business Standard article.

Orient Global picks 22.5% in India Info arm for $77m

India Infoline has inked a $76.7 million equity deal by selling stake in its consumer finance subsidiary India Infoline Investment Services (IIIS) to Singapore-based Orient Global. The latter has picked up a 22.5% stake in IIIS.

As per a company release, the capital would be primarily utilised for the expansion of IIIS’s subsidiaries, Moneyline, dealing with personal and auto loans and India Infoline Housing Finance.

Moneyline will leverage the group’s 600-branch network to provide credit to a wide clientele which does not have access to organised credit. Moneyline plans to have an active presence in 60 cities by the end of next year.

Read more in The Economic Times article.

Sequoia Capital invests Rs 100 cr in GVK Bio

Global private equity player Sequoia Capital has invested Rs 100 crore in Hyderabad-based contract research organisation GVK Biosciences. The company plans to use the money to fund acquisitions in the CRO space and also add to its existing capacities.

The investment comes close on the heels of Sequoia picking up an 18% stake in Hyderabad-based CRO SAI Advantium, signaling the PE major’s interest in the contract research space.

Part of the funds raised will also be used to finance the company’s new campus being built at Mallapuram near Hyderabad at a cost of Rs 60 crore. The investment would be made in a phased manner. The plan is to expand capacities in chemistry and informatics on the drug discovery front.

Read more in The Economic Times article.

Indiabulls to Open 30 Hypermarkets

After consumer finance and real estate, the Indiabulls Group is set to step into the retail business. Indiabulls Wholesale Services Ltd, a subsidiary of listed firm Indiabulls Real Estate Ltd, will set up 30 hypermarkets across as many smaller cities in the country in the next 15 to 18 months with an outlay of Rs 1,500 crore.

The first of these stores is expected to come up by March/April 2008 in one of the three cities the company is targeting simultaneously, confirmed Indiabulls director Gagan Banga.

These large-format stores, spread over 100,000 to 150,000 square feet, will be modelled on the lines of Costco Wholesale stores in the US, which operates the largest membership warehouse club chain in the world.

Read more in The Business Standard article.

India Info to sell 26% stake in arm for $100 mn

Leading foreign investors like Goldman Sachs and Blackstone are in final stages of negotiations to buy 26% stake in India Infoline Distribution Co (IILD), the distribution subsidiary of the brokerage firm India Infoline. The investors are willing to offer $100 million for the strategic stake in IILD.

The Mumbai-based broking firm’s move to offload stake comes after the proposed deal with Merrill Lynch fell through. Merrill Lynch, which had shown interest to invest in the subsidiary, later backed off citing technical reasons.India Infoline vice-president (planning and strategy) Harshad Apte confirmed that they are in talks with some funds.
However, he refused to divulge any further details. “We cannot give any specific names,” he said. On Friday, shares of India Infoline rose 2.50% to close at Rs 1,114.90 on the Bombay Stock Exchange.

Read more in The Economic Times article.

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IFCI raises bar for strategic investor

IFCI Ltd, the troubled term lender that has started the process of inducting a strategic partner, has agreed to its creditor banks’ demands to convert all their debenture holdings into equity shares.

This formula, which is expected to be ratified at a board meeting on December 1, could jeopardise the prospective partner's attempt to gain management control at the New Delhi-based institution.

The short-listed bidders for a stake in IFCI include Blackstone Group, General Electric Capital Corporation, billionaire Wilbur Ross along with Goldman Sachs Group, Standard Chartered and HDFC, Cargill Financial Services Corporation, Natixis and Newbridge Asia. Their bids will be considered after the conversion issue is resolved.

Read more in The Business Standard article.

25 foreign investors line up for UTI AMC stake

Private equity firm Blackstone, Goldman Sachs, UBS, Citigroup, National Australian Bank and Shinsei Bank are likely bidders for an equity stake in India’s oldest fund house, UTI Asset Management Company (UTI AMC).

Close to 25 overseas institutional investors have evinced interest in picking up a stake in the country’s third largest mutual fund. UTI AMC plans to offload 20% stake through a private placement and 29% through an initial public offer. However, no single investor would be able to hold more than 5%.

The private placement is expected to be completed by January while the initial public offer is slated for February-March. The listing process has to be completed before March 31, 2008. The fund house could raise about Rs 6,000-8,000 crore through the combination of private placement and initial public offer.

Read more in The Economic Times article.

Balaji may offload 15% in motion pictures arm

Balaji Telefilms, Ekta Kapoor-promoted production house, plans to offload 10-15 per cent stake in its wholly owned subsidiary Balaji Motion Pictures. Sources said the company is valued at Rs 1,000 crore. Centrum Finance is said to be the financial advisor to the company.

Sources added that the company is in talks with private equity investors. It is considering roping in only one private equity, instead of a cluster of investors. However, the plan is at a nascent stage.

The company is dabbling with movie distribution business as well, and has distributed Bhool Bhulaiya and Darling, among a few others.Going forward, the company plans to produce, co-produce and distribute around 12 films a year. Balaji will look at distributing films overseas for which it will licence individuals in the US, the UK and West Asia who will facilitate the business, instead of setting shop in these places.

Read more in The Business Standard article.

PE, hedge funds take 10% in Argentum

Argentum Motors a company floated by B V R Subbu, former president of Hyundai Motors India, Ajay Singh, promoter of budget airline Spicejet, and Ashish Deora, who runs a broadband company has offloaded 10% of its stake to three leading private equity and hedge funds D E Shaw, Rand Corporation of South Africa-promoted proprietary fund Satwa based in Hong Kong and Infrastructure Leasing and Financial Services Ltd (IL&FS).

Argentum took over the Daewoo Motors India factory near Delhi, which shut shop four years ago, for Rs 800 crore and is planning to set up one of the country’s largest auto ancillary units and function as a third-party manufacturer for auto companies.

The three funds have collectively forked out Rs 200 crore for the 10 per cent stake and have also provided the company a loan worth Rs 100 crore.The company is also looking for a fresh investment of Rs 500 crore to upgrade the facility and might look at more equity investors to finance the project.

Read more in The Business Standard article.

PE funds invest Rs 600cr in Godrej Inds

Godrej Industries has alloted 27.9 million shares for Rs 215 each to various entities raising about Rs 600 crore, a company statement said.

Of the shares alloted 13.95 million shares to State Bank of India (Equity), 5.3 million shares to Quantum, 3.14 million shares to Sloane Robinson and 2.3 million were issued to Deutsche Securities Mauritius.

HT Media buys social networking site

Firefly eVentures Ltd, a wholly owned Internet subsidiary of HT Media Ltd has acquired social networking site Desimartini.com in an attempt to enter one of the fastest growing segments in the Indian Internet space. Terms were not being disclosed, though HT Media said it was for less than $10 million (Rs 39.3 crore).

HT Media plans to launch online portals in jobs, matrimonials, real estate and auto verticals — areas where the classifieds pages of newspapers currently dominate and where the Hindustan Times has a strong presence in some markets.

Desimartini.com, launched by Pahwa Knowledge Based Services late last year, is funded by the Pahwa group of companies and has a membership base of 250,000. It attracts around 2.5 million page views a month. Apart from global social networking sites such as Google Inc.’s Orkut and Facebook (in which Microsoft Corp. has recently acquired a stake), Desimartini.com competes with homegrown players such as the Bangalore-based Minglebox.com, which connects students across school and university campuses, Ibibo.com, Indyarocks.com, and Bigadda.com, a site launched by Reliance Entertainment, part of the Reliance Anil Dhirubhai Ambani Group.

Read more in The Hindustan Times article.

DLF offloads 49% in 8 housing projects

DLF, the country’s largest real estate developer by market value, today said that it has sold 49 per cent stake in eight residential projects to private equity players for Rs 1,675 crore.

The development takes place five months after the company raised over Rs 9,000 crore from its initial public offering.

The realty firm has sold the stake in seven residential projects to a Merrill Lynch entity for Rs 1,480 crore, making this as one of the largest foreign direct investments in the Indian real estate sector.

These housing developments, classified as mid-income by the company at a price point of Rs 55 lakh an apartment, are located at Chennai, Bangalore, Kochi and Indore. All these projects are expected to be developed in about seven to eight years.

DLF has also sold 49 per cent stake for Rs 194 crore to Brahma Investments in another residential project at Panchkula, Haryana.

Read more in The Business standard article.

Plethico buys US company for $81 mn

Plethico Pharmaceuticals, a leading Indian herbal and nutraceutical (a combination of drug and food products) company, has agreed to acquire Natrol, a nutritional products company in the US, for $81 million (Rs 318 crore).

The acquisition will make the Rs 440-crore company one of the largest herbal and nutraceutical manufacturers in India.

Natrol has about 550 products and eight top-selling nutraceutical and dietary supplement brands in the US market, including hair nourishing products and Prolab, a fast moving body building brand.

Natrol has a network of about 54,000 outlets and its products are sold through leading US stores such as Wal-Mart. The company also has operations in the United Kingdom and Hong Kong.

Read more in The Business Standard article

Gitanjali acquires US jewellery retailer

Gitanjali Gems has acquired US retail jewellery chain Rogers for $18.5 million to boost the company’s retail presence in abroad.The acquisition will enable Gitanjali to leverage Rogers’ existing retail infrastructure and access US consumers.

The privately held Rogers is headquartered in Middletown, Ohio and operates 46 retail stores under brand names Rogers Jewelers and Andrews Jewelers. Rogers revenues this year stood in the region of $80 million.

Gitanjali was looking at raising capital for its acquisition and expansion plans. It has proposed to garner around Rs 320 crore by issuing 10 million convertible equity warrants to the promoters on a preferential basis.

In December last year, the company bought US-based jewellery chain Samuels, marking its maiden acquisition in the gems and jewellery space. Samuels has 100 stores in the US, with sales of Rs 500 crore and a back-end capacity for 150 new stores.

Read more in The Business Standard article.

Kubera Fund to seal five deals by year-end

Kubera Cross-Border Fund, a close-ended private equity fund listed on the London Stock Exchange’s Alternative Investment Market (AIM), will seal four to five deals in India by the year-end.

The average size of the investment will be $20-40 million. The fund raised close to $225 million for investment in cross-border companies.

Cross-border companies are those West-based companies that seek to leverage Indian resources for lower cost and talent availability and Indian companies that seek to expand in other global markets through acquisition etc.

The fund has invested $20 million in two companies — Adayana Inc and Kejriwal Stationery. US-based Adayana Inc, an e-learning services company with offshore development operations in Hyderabad, caters to vertical markets including automotive services, defence, food, agriculture and life sciences.On the other hand, Kejriwal Stationery manufactures and distributes stationery products to customers in the US, European and Indian markets.The PE fund is likely to raise another $225 million next year by issuing more shares.

Read more in The Business Standard article.

ICICI arm plans Jaypee stake buy

ICICI Venture Funds Management Co. Ltd, the private equity arm of ICICI Bank Ltd, India’s second biggest lender, is planning to invest about $800 million (Rs3,148 crore) to pick up a stake in Jaypee Infratech Ltd, a unit of the cement-to-construction conglomerate Jaypee Group, said a person familiar with the matter.The size of the proposed stake could not be ascertained. Jaiprakash Associates and ICICI Venture declined to comment.

Jaypee Infratech is a fully-owned unit of the Jaypee Group and was floated to implement the Taj Expressway project, a 165km highway connecting the cities of Noida and Agra in Uttar Pradesh along the banks of the Yamuna river. The company has also got the right to develop 25 million sq. m of land along the expressway, according to annual report of group company Jaiprakash Associates Ltd, which won the rights to build the road. The rights will be transferred to Jaypee Infra-tech, the report said.

Read more in The Livemint article.

Unitech owners plan an NBFC

The owners of India's second-largest listed real estate firm, Unitech Ltd , plan to set up a non-banking finance unit to sell home loans in the fast expanding market."We are looking at within a year to start the business," the paper quoted Unitech Managing Director Sanjay Chandra as saying.

The NBFC will provide services related to real estate finance, possibly mortgage finance.The financial services business would be managed by an unlisted group company and the funding would come from the Chandra family's personal wealth, the paper said.It also said Unitech was in talks with international insurance firms to offer general insurance in India.

Lodha Developers plan Rs 8,000cr IPO

Lodha Developers, a Mumbai-based realty firm, plans to raise between Rs 6,000-Rs 8,000 crore through a public issue within the next 12-months and off-load 10-15% stake in the process.The realty major, which has an ambitious and massive expansion plan of around Rs 10,000 crore, will use the proceeds of the IPO to fuel this expansion.

The IPO plans are expected to be fine-tuned over the next 3-4 months. "The promoters are expected to off-load around 10-15% of their stake," a source said.

The Mangal Prabhat Lodha-spearheaded group plans to use the IPO proceeds to fund expansion, which include residential and commercial projects in Tier I and II cities. This includes up-market residential projects of around Rs 2,000 crore at Walkeshwar and Prabhadevi in the metropolis.

Lodha group had recently acquired a 12.9-acre plot in Eden Square, Hyderabad, for Rs 255.42 crore, to develop a high-end commercial complex in about three million square feet area.

ICICI Venture seen in talks to buy out Shalimar

Shalimar paints is rumored to be in discussions with ICICI Venture for a possible majority stake sale to the latter.The PE major was working on tabling a possible offer valuing the company at around Rs 450 crore.The company, with three plants at Sikandrabad, Nashik and Howrah, has an annual capacity of around 43,000 tonnes.

When contacted, ICICI Venture declined to comment. Sandeep Sarda, executive director & CEO, Shalimar Paints, said: “If there is a proposal, we might examine it. But as of now, there is nothing before us. And we are unaware of any such developments.”

However,it is rumored that talks have taken place between ICICI Ventures and Shalimar on a possible deal. It is learnt that for the promoters, Jindals and Jhunjunwalas who have diversified interests, the paint business may not be core any longer, triggering a possible sale .

Recently, the company informed the exchanges it would undertake development of its real estate assets through a JV. Around 35% of the domestic paint market is still in the unorganised segment. Asian Paints is the leader with about 27% stake, while Berger and Nerolac are locked in the second slot with 12% each. ICI, in which Asian Paints is a stakeholder, follows with roughly 9% share.

Read more in The Economic Times article.

ICICI Venture, Baring PE set to buy 32% in Karvy for Rs 500 cr

Leading private equity investors ICICI Venture and Baring Private Equity Asia are set to invest around Rs 500 crore to pick up around 32% stake in Karvy Stock Broking Limited (KRBL), an arm of the Hyderabad-based Karvy Group.

The deal puts the enterprise value of the securities firm at around Rs 1,500-1,600 crore. MAPE Advisory Group advised Karvy on the transaction. The valuation, however, is lower than that of other established stock broking and investment banking players like Edelweiss Capital, Indiabulls, Motilal Oswal Securities and India Infoline which took PE route in the past and raised funds from the primary market.

ICICI Venture and Baring Private Equity are buying the 20% equity held by existing investor Pacific Century Group (PCG), while an additional 12% stake will be offered to them in the form of fresh equity, according to sources. The Hong Kong-based PCG had acquired the stake for Rs 83 crore in 2005, which had valued Karvy at around Rs 415 crore then.

Read more in The Economic Times article.

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ICICI Ven buys Karvy stake:Sources

GE Energy takes indirect stake in KSK Power

GE Energy Financial Services has picked up 26% stake in Sayi Power Energy, a majority shareholder in KSK Power. Financial details of the transaction were not disclosed.

"This transaction reinforces GE Energy Financial Services’ growth in India's power market," said Raghuveer Kurada, managing director of GE Energy Financial Services’ India operations. "KSK's pioneering leadership in mid-sized captive power generation and access to dedicated low-cost fuel reserves creates opportunities for sizeable additional investment in new power projects. We will play a strategic role in helping KSK to carry out its growth plans."

KSK, which develops and owns downstream energy assets throughout India, is the country’s first power generation company to be listed overseas - its shares trade on the London Stock Exchange Alternate Investment Market.

KSK's portfolio of existing and future power generation assets is diversified across fuel types. The company has eight projects in operation or under construction representing 875 Mw. KSK’s pipeline of future projects total 3,200 Mw, and is expected to come online by 2012.

ITC acquiring Parle's unit-Sources

It is speculated that ITC Foods is in an advanced stage of discussions with Parle for acquiring the latter's confectionery arm. However, when contacted, both ITC divisional chief executive (foods) Ravi Naware and Parle chairman Ramesh Chauhan denied that a deal is brewing.

"We do not comment on market speculation," Naware said, while pointing out that the company is continuously on the lookout for acquisitions in the foods business."If we get a good opportunity, we will buy." Chauhan said he has not been approached by anybody, including ITC. "Even if there is a proposal, I will not sell," Chauhan said.

ITC has been looking for buyouts in the foods space for the last couple of months. Since ITC entered the foods business in 2001, it has only acquired one brand, 'Mint-O', which is one of the leaders in its segment.

The foods business accounts for a major portion of the over Rs 1,800 crore revenue of ITC's new FMCG businesses. Its brands include 'Kitchens of India', 'Sunfeast', 'Candyman', 'Bingo' and 'Aashirvaad'.

Read more in The Times of India article.

DLF to buy ultra-luxury Amanresorts for $250 mn

DLF, the country’s largest realty firm by market capitalisation at over Rs 1,48,527 crore,is acquiring the privately-held super luxury resorts and spa chain Singapore-based Amanresorts for around $ 250 million.The company had announced a month ago that it intends to raise $750 million overseas for acquiring and developing properties abroad. Part of the proceeds would be used for funding the Amanresorts acquisition.

Sources close to developments said at $250 million, the deal is being concluded at an extremely conservative valuation. In addition to this payout, DLF will assume debt of approximately $220 million as part of the deal.This will be the first overseas acquisition by India's largest real estate company, which recently went public.

The 20-year-old Amanresorts has 18 operational properties under its belt in Indonesia, Cambodia, Sri Lanka, Morocco, Bhutan, India, the Philippines, the United States, French Polynesia and France.

Read more in The Business Standard article.

HDFC AMC hikes stake in Biocon to 5.15%

HDFC Asset Management Company (AMC) has hiked its stake in Biocon, a Bangalore-based biotech company.The company in a release to NSE, said it has hiked its stake to 5.15% from existing 4.97% through market purchase from Edelweiss Securities executed on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE).

The HDFC Mutual Fund comprising of HDFC Capital Builder Fund, HDFC Equity Fund, HDFC Children's Gift Fund - Investment Plan, HDFC Growth Fund, HDFC Top 200 Fund, HDFC Long Term Advantage Fund, HDFC TaxSaver, HDFC Core & Satellite Fund, HDFC Premier Multi-Cap Fund, and HDFC Long Term Equity Fund has made investments in Biocon.

Panoramic Universal acquires stake in Hi-Flyers

IT and hospitality company Panoramic Universal has acquired a controlling stake in Hi-Flyers Travel Services, a travel agency.Hi-Flyers is a full service travel outfit providing international and domestic ticketing, package tours to popular destinations world-wide and forex services, among others.

“Panoramic has plans to launch a travel portal of its own very shortly. We intend to offer a comprehensive travel solution to our customer right from travel arrangements to staying in our own hotels,” Chairman of Panoramic Universal Sudhir Moravekar said in a filing to the Bombay Stock Exchange.

Apart from India, the company also owns and operates hotels in USA and New Zealand.
Panoramic Universal is looking for hotel projects in places like Jaipur, Hyderabad, Kumarakom (Kerala), Durgapur (West Bengal) and Panvel (Mumbai), the filing stated.

Calsoft to acquire US consulting firm

Chennai-based California Software (Calsoft) is acquiring a 100% equity stake in technology consulting firm International Innovations Inc., to strengthen its enterprise offerings in the analytics and business rules management space. The target company’s valuation will be capped at a maximum of $1.32 million (approximately Rs 5.3 crore).

The letter of intent (LoI) to purchase the Mountain View, California-based, company will culminate in a definitive share purchase agreement, the process of which is expected to be completed by December 31 this year. The deal envisages phased payments by Calsoft over a period of one year from the conclusion of the share purchase agreement and will also be based on certain performance parameters, Calsoft said.The acquisition is expected to add $2.3 million with PAT of $300,000 to Calsoft’s cash kitty over the next 12 months.

Read more in The Business Standard article.

PEs to take a sip of Cafe Coffee Day for $95 mn

The VG Siddhartha-led Amalgamated Bean Coffee Trading (ABCTL)is to expand and develop ABCTL’s retail business, the key component of which is Cafe Coffee Day, the country’s largest chain with 480 cafes in India.It is closing a $95 million (Rs 340 crore) fund-raising from Deutsche Bank and Templeton Darby International for the expansion.

The transaction, which has been in the making for a while, is likely to be wrapped up soon. Mr Siddhartha, is a pioneer of India’s coffee cafe culture and won ET’s Entrepreneur of the Year Award in 2003.

The two private equity investors together are expected to take a little over a 10% stake in ABCTL’s retail business, whose enterprise value is close to $600 million with debts included, sources say. It is believed that Deutsche Bank will invest $70 million with Templeton Darby International bringing in the remaining $25 million.

Read more in The Economic Times article.

Indiaco Ventures buys 20.83% stake in Laser Cosmetics

Private equity player Indiaco Ventures Ltd on Monday said it has acquired 20.83 per cent stake in Laser Cosmetics Pvt Ltd.The company has also subscribed 25 per cent in preference shares of Laser Cosmetics, Indiaco Ventures said in a communique to the Bombay Stock Exchange.

The company now holds 1.5 lakh shares of Rs 10 each out of the total 7.20 lakh shares and 12,500 preference shares of Rs 100 each out of the total 50,000 preference shares of Laser Cosmetics Pvt Ltd.

Indiaco provides capital (investment), direction and operational expertise in distinct asset classes for select identified industry verticals. The company has been recognised by various multilateral agencies and is supported by InfoDev, a World Bank initiative.

Laser Cosmetics Pvt Ltd has clinics operating which are stand alone centres to cater to spectrum of cosmetic surgery services under the brand name of "MAAYA", the company plans to expand across major Indian cities.

Diageo may buy into United Spirits

Global drinks leader Diageo is said to have evinced interest in picking up a minority stake in Vijay Mallya’s liquor flagship United Spirits (USL). Sources said talks exploring the possibility of Diageo buying around 10-13% in the Indian spirits behemoth, the world’s third-largest by volume, for $500-600 million have taken place.

Sources said Diageo was interested in buying into USL with the latter’s enterprise valuation pegged at over $5 billion. It is believed that the domestic giant may be open to placing a small stake with Diageo without ceding management control. This could see Diageo entering as a financial investor, for now, at least. In many ways, observers say, the move is reminiscent of Vodafone’s buy into Airtel some years back.

Read more in The Economic Times article.

Walt Disney on prowl for Indian acquisition

It could be the mother of all deals in the media and entertainment sector in India. And it involves none other than global media and entertainment giant Walt Disney.A year after Disney bought a 14.85% stake in UTV,it is reported that Disney is on the prowl again.

As for names, sources said that it could possibly be UTV because Walt Disney already has 14.85% stake in UTV which they bought last year for Rs 65 crore and that they maybe interested in hiking that stake. If they do want to hike the stake, they would have to buy it from the promoters and the promoters, led by Ronnie Screwvala, have 30% stake in UTV. Out of this 17% is locked in which means that technically they can sell 13% in UTV to Walt Disney.

Read more in The Moneycontrol article.

mChek plans to raise $15m PE funds

Mobile payments and security company, mChek is all set to expand its operations in the country and is now looking to raise $5-15 million in its second round of funding. Earlier funded by Draper Fisher Jurvetson, the company is likely to rope in another private equity player for its second round of expansion.

Rolling out its third expansion plan, mChek is now launching its services with four merchants — indiatimes.com, futurebazaar.com, sify mall and yatra.com. All that mChek users have to do is put in their mobile numbers and authenticate the transaction SMS with their mChek pin. Earlier, mChek tied up with Bharti Airtel for bill payment across the country.

Read more in The Economic Times article.

ICICI Ven buys Karvy stake:Sources

ICICI Venture seems to have got a toehold in Karvy Stock Broking, which, sources said, is most likely to have parted with a chunk of its equity in favour of the domestic private equity (PE) fund.

While neither the value of the deal nor the size of the stake could be officially ascertained, it is learnt that Hong Kong’s Century Pacific Group, which had invested in Karvy in mid-2005, wanted out.

Century Pacific had picked up a 20% stake in Karvy Stock Broking for Rs 83 crore, which had valued Karvy at Rs 415 crore then.Sources indicated that Karvy now values itself at around Rs 1,000 crore, which is probably one of the reasons why others opted out of the race.

Karvy chairman C Parthasarathy, however, denied the closure of any deal with ICICI Venture.

Read more in The DNA Money article.

Blackstone to invest $65 mn in MTAR

The Hyderabad-based MTAR, a privately-held company promoted by P Ravindra Reddy, Satyanarayana Reddy and P Jayaprakash Reddy,has sold 26% stake to Blackstone for about $65 million, which is in one of the first PE deals in the defence and nuclear science space.MTAR Technologies makes critical components and products used for nuclear and space projects.

The funding is through a mix of additional issue of shares and equity sale by the promoters. MTAR will continue to be led by the founders, who will hold 74% cumulatively. After the deal, Blackstone will have three representatives on the 12-member board of the company.

Currently, the company has an order book of Rs 250 crore executable over two years. While MTAR’s revenues are undisclosed, the management is aiming to raise it four to five times by 2010.

Read more in The Economic Times article.

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Amtek Auto buys UK's Triplex-Ketlon

Auto parts maker Amtek Auto Ltd said on Wednesday it had acquired UK-based precision machining firm Triplex-Ketlon Group for an undisclosed sum.With this, Amtek's revenue from international operations will rise to $770 million a year, and it expects to cross $1 billion per annum within the next two years.

Triplex Ketlon was acquired by the UK-based Barr family in September 2003. According to the company’s website, Triplex, it has three manufacturing sites — at Hereford, Stratford-upon-Avon and Paddockwood. The company supplies fully-machined components and sub assemblies to passenger car makers, commercial vehicle makers and tier-I manufacturers.The auto component sector has seen some aggressive deal making in recent times with Bharat Forge, M&M and Amtek being the most active in the deal space.

Read more in The Economic Times article.

Tata Sky plans to raise up to $200 mn

Tata Sky a DTH major which is a 80:20 JV between the Tata group and television network Star is considering a second round of funding of $150-200 million and is in conversation with various private equity players such as Providence, Carlyle, Blackstone, Goldman Sachs and Apax Partners.

By law, a DTH operator in India has to be have a minimum holding of 51% by an Indian entity. Singapore-based PE player Temasek had bought about 10% for about $56 million. The valuation of the company in three months has risen more than two-fold.

Tata Sky is looking at diluting about 10% stake. The current holding structure of Tata Sky looks like this: 20% with Star (FDI), 10% with Temasek (FII) and 70% with the Tata’s. Tata Sky’s fund-raising is timed to coincide with the proposed launch of Reliance Communications and Bharti’s DTH operations. In order to face the threat from Reliance and Bharti, Tata Sky needs to ramp up in terms of infrastructure and technology.

Read more in The Economic Times article.

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Tatas offload 10% in Tata Sky to Temasek

PE firm to invest in Leela

Hotel Leelaventure, the parent company of one of India's leading hotel chains - Leela Palaces, Hotels and Resorts is getting private equity investment from a US-based private equity (PE)to the tune of Rs 5,000 crore.The PE firm is most likely to be Blackstone.

Chairman of the Leela Group, Capt C P Krishnan Nair confirmed the investment but he declined to divulge the name of the PE firm or state how much equity dilution had taken place.

Leela also has plans to diversify into an altogether untapped market - religious destinations, in which the organised sector constitutes only 10%."We will launch a second chain of 5-star luxury hotels called Leela Gardens, which would come up in religious/devotional cities," said Capt Nair.

Read more in The Times of India article.

Ess Dee Aluminium to pump in Rs600 cr in acquisitions

Aluminiums packaging firm Ess Dee Aluminium has set aside about Rs500-600 crore most of which would be spent over next one year primarily in acquisitions.The company is striving for huge growth through the inorganic route earmarking Rs500-600 crore for acquisitions in the domestic and international markets.

The company is eyeing Kolkata-based India Foils currently under the Sterlite Group.
Confirming the development, Sudip Dutta,managing director Ess Dee Aluminium said the company was in the fray for India Foils currently under the Sterlite group.

India Foils has three units of which two are closed.Ess Dee had sought state government assistance like electricity subsidy and sales tax waiver for the turnaround.The company has also bid for Alcan’s packaging business which could be valued at $1 billion.

Read more in The Livemint article.

Apollo to offload 15% for $70 mn

Apollo Health Street (AHS), the healthcare business process outsourcing subsidiary of Apollo Group that runs India’s largest hospital chain, plans to raise $70 million from the capital market by offloading 15% of its equity. The Hyderabad-based company has been valued at nearly $470 million. The company will come out with its initial public offer (IPO) in the first quarter of 2008.

AHS is also looking to get outsourcing contracts worth several millions of dollars from private equity player Apax Partners, which runs 45 hospitals in Europe. Apax Partners picked 11% stake in parent company Apollo Hospital Enterprises for $100 million last month.

Read more in The Economic Times article.

L&T signs JV with US firm for pipelines

Engineering and construction firm, Larsen & Toubro Ltd, said on Friday it had signed a joint venture for pipelines with US-based Gulf Interstate Engineering Co."The joint venture company will augment L&T's offering in pipelines," L&T said in a statement to the National Stock Exchange.

J&K Bank seeks foreign partner for 49pc stake in broking unit

Jammu & Kashmir Bank is scouting for a foreign partner to pick up 49 per cent in its planned stock broking subsidiary, a top official said.

In August, the bank received the Reserve Bank of India's approval to set up a stock broking subsidiary. It also plans to come out with its $100 million issue of global depositary receipts by mid-December, he said.

The issue would comprise about 6 per cent of the bank's equity, he said. The bank, 53 per cent owned by the state government, over the weekend announced a 30 per cent rise in its quarterly net profit beating analyst forecasts. It posted July-Sept net profit of Rs 108 crore on total income of Rs 654 crore.

Read more in The Economic Times article.

Amit Burman plans food courts

Amit Burman, founder of Dabur Foods, is planning to launch food courts in shopping malls, office complexes, at national highways as well as mini-restaurants at metro stations. It is estimated that India would have around 250 new malls by 2010.

Burman, along with two other partners, Rohit Aggarwal and Tejpavan Singh Gandhok, has invested close to Rs 200 crore in the venture.The partners hope to reach a sales target of Rs 1,000 crore, with retail outlets across 200 locations, in the next three years.

Burman, who currently operates nine franchisees of Subway, has tied up with Dubai-based Hot Brands to start quick service food joints serving Chinese, Italian, Thai and Indian cuisines. “We will also acquire local companies from small cities to address specific regional tastes,” shares Burman.

Read more in The Business Standard article.