BSNL IPO hits roadblock!

The much awaited $10 billion BSNL IPO has hit a road block before even taking-off. Communications minister A Raja's offer to give all the 3 lakh employees 500 shares at Rs 10 each has been rejected by the Union. This would have fetched each employee a minimum of Rs 1.5-2 lakh at the time of BSNL’s listing on the bourses.

If the share were to list somewhere between Rs300-400, it would give BSNL valuation of $37-45 billion which is way lower than $100 billion what the company has been claiming since January.According to analysts, the $37-45 billion valuation is a fair one. BSNL has about 81 million subscribers, 10 million more than the country’s largest private operator, Bharti Airtel, which is valued just over $38 billion. However, a top BSNL official said that this was only the book value of the company and did not include its asset value.

Read more in The Economic Times article.

Bombay Dyeing likely to spin off realty

Textile major Bombay Dyeing is considering demerging its real estate business into a separate company, according to sources.The hiveoff will be followed by an initial public offering.Company officials refused to comment, saying Ness Wadia alone can speak on this.Wadia could not be contacted as he is in the thick of the IPL cricket extravaganza.

The Street, nevertheless, is betting on the move.Analysts said a spin-off helps Bombay Dyeing get better valuations.They expect concrete plans to be announced by August.

The development plans for the textile major’s Worli and Dadar properties are huge: about 10 million square feet for IT parks, retail hubs, commercial and residential projects, hotels and serviced apartments.The capex involved will run into hundreds of crores.The company has already begun sales of residential projects valued at around Rs 500 crore.

Sources said Bombay Dyeing plans to sell only 0.4 million sq ft, of its residential development at Dadar, and commercially lease the remaining 3.9 million sq ft including at Worli.

GVK Power may hive off energy arm

GVK Power and Infrastructure is planning to hive off its energy vertical into a separate company, ahead of a possible initial public offering (IPO) for the proposed company. The ground-work for the hive-off has begun, with the company bidding for oil blocks in the seventh round of the new exploration licensing policy (NELP). But plans for the IPO of the proposed company are yet to be finalised.

The asset base of the energy vertical is expected to touch Rs 12,000 crore after the completion of projects in the pipeline. GVK Power and Infrastructure is executing six power projects and two coal mine projects. It now wants to have a slice of the pie in oil and gas exploration as well and has hence bid for a couple of oil blocks under NELP-VII.

Read More in The Economic Times article.

Oil India to go ahead with initial offering

Oil India (OIL), the country’s second largest government-owned exploration and production company, plans to go ahead with its initial share sale to the public despite the stock markets falling more than 29 per cent from its peak in January. However, the issue, earlier scheduled for February, is likely to be delayed by a few months.

There were speculations that OIL’s share sale may be put off “indefinitely” as the government is not keen that the company enter a weak market.Rubbishing speculations that the share sale has been put off indefinitely due to market volatility, OIL Chairman and Managing Director MR Pasrija said, “Our fundamentals are strong and the demand for petroleum will remain high,” adding that the high crude oil prices would mean the bottomline would remain strong.

OIL had planned to offer 10 per cent of its shares to the public in February to raise around Rs 2,000 crore.But this sale didn’t happen as the company is yet to meet the Clause 49 norms, which makes it mandatory for a listed company with an executive chairman to have half of its board made up of independent directors.

Pasrija did not give a timeframe for the public offer as the company is awaiting government clearance.

The government also plans to sell 10 per cent of its equity in OIL to Indian Oil Corporation, Bharat Petroleum Corporation and Hindustan Petroleum Corporation to raise another Rs 2,000 crore.

The company has appointed JM Morgan Stanley, Citigroup and HSBC Securities as the book running lead managers to the issue.

Read more in The Business Standard article.

Related Stories:
OIL allowed to sell 10% through IPO
OIL will issue bonus shares after IPO

10 i-banks compete to manage GSPC’s September public issue

Ten merchant banks have put their hands up to manage Gujarat State Petroleum Corp. Ltd’s (GSPC) fresh proposal for an initial public offering (IPO) in September, with the company now fetching a 50% premium over its valuation in late 2006 when it made its first approach for an issue.

GSPC, which postponed its earlier plans for an IPO, has not yet handed out the mandates, but bankers involved in the said GSPC could raise $1.5 billion (Rs6,045 crore) from its IPO. The quantum of shares on offer will be decided after mandating the bankers.

Citigroup Global Markets India Pvt. Ltd, UBS Securities India Pvt. Ltd, Deutsche Securities (India) Pvt. Ltd, JPMorgan India Pvt. Ltd and DSP Merrill Lynch Ltd are the five foreign investment banks that attended the second round of IPO talks in February.The domestic line-up had SBI Capital Markets Ltd, ICICI Securities Ltd, Enam Securities Pvt. Ltd, Kotak Mahindra Capital Co. Ltd and JM Financial Consultants Pvt. Ltd.

Read more in

The Live Mint article.

Wockhardt cuts IPO price band on mkt woes

The volatility in the Indian stock market has forced Wockhardt Hospitals to revise the price band to Rs 225 (20 per cent at the lower end) and Rs 260 (16 per cent at the upper end) per equity share (from Rs 280 to Rs 310) for its initial public offering (IPO) of 25.09 million equity shares of Rs 10 each for cash at a price determined through a 100 per cent book-building process.The issue opens on January 31 and closes on February 5.

The Emaar-MGF management, on the other hand, has decided to stick to its price band of Rs 610-690 for 10.26 million shares.The issue will open on February 1. The IRB Infrastructure Developers issue of 51.06 million equity shares (which opens tomorrow) has a price band of Rs 185 to Rs 220.

The proposed IPO of Wockhardt Hospitals has been assigned an IPO grade of 4 out of 5 by rating agency Fitch Ratings India, indicating above-average fundamentals.Wockhardt Hospitals intends to utilise the proceeds from the issue to meet the cost of development and construction of greenfield and brownfield hospitals of the company, pre-pay some of the short-term loans and to meet general corporate expenses.The equity shares are proposed to be listed on the Bombay Stock Exchange and National Stock Exchange.

OnMobile to raise over Rs 450cr through IPO

OnMobile Global, plans to enter the capital market with an initial public offer (IPO) of 1.09 crore equity shares of Rs 10 each through a book building process in the price band of Rs 425-Rs 450 per share. The issue opens on January 24 and closes on January 29.

OnMobile a telecommunications value added software products and services, plans to use the funds for expanding its research and development team, foraying into international markets, merger and acquisition and to meet working capital requirements, repayment of loan and to fund expenditure for general corporate purposes.

The issue would constitute 18.99% of fully diluted post issue paid-up capital of the company. The equity shares are proposed to be listed on BSE and NSE.

Read more in The Business Standard article.

BSNL plans mega-IPO of Rs 40,000 crore

State-owned Bharat Sanchar Nigam Ltd (BSNL) is preparing for the country’s largest initial public offering (IPO) of around $10 billion (Rs 40,000 crore) slated sometime next year.The issue has been discussed by the board and is awaiting government clearance.

The plan is to divest 10 per cent through the IPO, which values India's largest telecom company at $100 billion (Rs 400,000 crore), which is larger than the combined market capitalisation of Bharti Airtel at $46 billion (Rs 183,283 crore) and Reliance Communications (RCom) at $41 billion (Rs 163,683 crore), respectively the second- and third- largest telecom companies.

The plan that it might go public was announced by Communications Minister A Raja on the sidelines of a press conference at which BSNL announced an insurance cover for 33.7 million of its subscribers.

The announcement comes a day before the $3 billion (Rs 11,500 crore) IPO by Reliance Power, owned by the Anil Dhirubhai Ambani Group, the largest initial share offering to date.

Read more in The Business Standard article.

SBI, ICICI buy 3% in Jaiprakash Power Ventures

State Bank of India (SBI) and ICICI Bank have together acquired 3% in Jaiprakash Power Ventures (JPVL), a wholly-owned subsidiary of Jaiprakash Associates (JAL), for Rs 400 crore in first of two private placements before its initial public offer (IPO).

This would be followed by another pre-IPO placement before the firm hits the market with a public offer, together raising Rs 3,500 crore.The company will dilute another 17% through the private placement and IPO.Of this, the pre-IPO deal is expected to be for about 3-4% of the equity, while the rest would be through the public offer. SBI and ICICI are supposed to have paid a little over Rs 230 per share.

JPVL is looking at a valuation of $5.5 billion, post-IPO. Following the IPO, the shareholding of Jaypee group in JPVL would come down to 80%.

Read more in The Economic Times article

ICICI Bank eyeing I-Sec IPO: Traders

India's most-valuable lender, ICICI Bank, may be planning an initial public offer in its investment banking and broking unit, traders and analysts said on Monday, sending its shares soaring more than 6 per cent.A spokesman for New York-listed ICICI said it was exploring various opportunities for its subsidiaries and that an announcement would be made if there was any decision.

The bank held a meeting for a group of investors on Monday, and traders said that was the source of the IPO talk in ICICI Securities, which lifted the stock from a 3.9 per cent early fall to end up 6.1 percent at a record close of Rs 1,363.90 ($34.7).

ICICI Securities offers services in corporate finance, fixed income and equities and operates out of Mumbai with offices in New Delhi, Chennai, Kolkata, New York, London and Singapore, according to its Web site. It also has a subsidiary in the United States which is a member of the National Association of Securities Dealers Inc and is registered with authorities in the United Kingdom and Singapore to offer corporate advisory services.

Read more in The Economic Times article.

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.

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.

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.

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.

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.

RCOM to offload 10% in tower arm via IPO

Reliance Communications is likely to list its tower arm — Reliance Telecom Infrastructure Ltd (RTIL) — by March. The company which has already offloaded 5% stake in RTIL to outside investors, plans to sell an additional 10% in the company through an IPO.

The valuation of the company as per its 5% equity placement in July to seven institutional investors from the US, Europe and Asia was about Rs 27,000 crore. It is also learnt that the promoters (Reliance Communications) will sell shares and therefore there would not be a fresh issue of equity.

RCOM’s primary competitor Bharti Airtel, which is currently in the process of transferring its mobile telecom towers and related infrastructure to Bharti Infratel, has already prepared a road map which would allow the company to divest a majority stake in its tower arm in the future.

After the completion of the demerger, Infratel will enter into comprehensive sharing agreements with other service providers while Bharti in time would divest a majority stake and may also go for an IPO, thus making it a completely independent company, Bharti Airtel chairman Sunil Mittal said.

Religare eyes up to $35 mn via IPO

Religare Enterprises has set a price band of Rs 160-185 per share for its initial public offer, the financial services firm said in a statement.

At upper end of the band, the firm, which is selling 7.57 million shares, would raise Rs 1.4 billion ($35 million).

Enam Financial Consultants and Citigroup are advising Religare, founded by the the owners of Ranbaxy Laboratories.Merrill Lynch has bought a 5 per cent stake in the firm.

Related Posts:

Merill arm buy 5% in Religare
Macquarie Bank buys 50% in Religare`s wealth management

Merrill arm buy 5% in Religare

Global financial services player Merrill Lynch has bought a five per cent stake in Religare Enterprises, a Delhi-based financial services-cum-brokerage outfit, for about Rs 60 crore through its subsidiary Indopark Holdings.

The deal values Religare Enterprises, which has filed a draft document for an initial public offering (IPO), at about Rs 1,212 crore. The IPO is likely to hit the market by this month-end.

Indopark Holdings will get 37,88,050 shares post-IPO and these shares will have a lock-in period of one year, as stipulated by the Securities and Exchange Board of India (Sebi) rules.

Religare Enterprises, which is promoted by the Ranbaxy group founders, is planning to raise close to Rs 150-160 crore through the IPO.Religare Enterprises is the holding company for all its businesses, with its subsidiaries, Religare Securities, Religare Wealth Management Services, Religare Capital Markets and Religare Insurance Broking, among others.

UTI likely to sell 15% in AMC to global player

UTI Mutual Fund, owned equally by Life Insurance Corporation and three public sector banks, is likely to rope in a strategic partner by offering 15 per cent equity in the Asset Management Company, ahead of its Rs 2,000 crore ($ 500 million) initial public offering (IPO).The strategic partner is likely to be an international player, having a presence in developed markets, said sources.

The strategic partner would be offered a slot on the UTI AMC board with a view to bringing in technology expertise and international knowhow, among other things.

The existing shareholders — LIC, State Bank of India, Punjab National Bank and Bank of Baroda (they are financial investors) — would be diluting a combined 20 per cent stake in the Mumbai-headquartered fund house during the IPO. Post-listing, UTI MF will become the first mutual fund house in India to be traded on the stock exchanges.

Shareholding by the four state-owned entities, which bought the entire government holding in 2005 by acquiring 25 per cent stakes each in UTI AMC, would come down to a combined 65 per cent after the strategic stake sale and IPO. They had bought the government’s stake in the fund house in 2005 for Rs 1,236 crore — a blockbuster investment considering that the AMC is currently valued between Rs 6,000 and 8,000 crore within less than three years.

UTI AMC has close to 8.5 million customers and it is the third biggest fund house (after Reliance and ICICI-Prudential MFs) with assets under management of over Rs 45,000 crore.

Read more in The Business Standard article.

DLF to raise $1.5 bn via global debt float

Real estate major DLF plans to raise $1.5 billion through an international debt float. Of this, the company plans to spend $750 million buying land and building properties in India and abroad. The remaining amount will be used to buy shares in an IPO by group company DLF Offices Trust in Singapore. According to sources, the company has appointed Lehman Brothers and Goldman Sachs as its advisors for the issue.

DLF Offices Trusts issue may hit the Singapore markets in January. This issue will be the second initial offering in Singapore of an Indian real estate investment trust.
These plans were approved by the company's board on Thursday.

Of late, the company has been very aggressive in forging international deals. In August, it formed a joint venture with Hines, a closely held US-based property investor, to develop an office, retail, hotel and entertainment project on a 15-acre site in Gurgaon. This month, DLF signed a collaboration with a unit of Dubai World to develop a $15 billion township near Bangalore.