Boeing to outsource F-18 components to India

US civil and defence aerospace major Boeing has decided to outsource two critical components of the F-18 Super Hornet combat aircraft to India and the order for one of them could go to the Tatas.

Lt Gen Jeffrey B. Kohler, Boeing vice president for international strategy, told the India Strategic defence magazine that as a “responsible world player in aerospace, Boeing wanted a long-term, trusted partnership with India and that the orders for these two components are being placed now irrespective of whether or not the company wins the tender for 126 Multi Role Combat Aircraft (MRCA).”

Both the components are made with sophisticated composite materials, appropriate technology for which will be transferred to India. Details are to be given later.

Mr Kohler said that one of these two fighter jet components could be outsourced to the Tatas, with which it had earlier tied up a $500 million agreement for titanium floor beams for the hot-selling new generation Boeing 787 Dreamliner aircraft that Air India has also ordered.

Read more in The Economic Times article.

Tata Power ties up debt for $4.2 bln project

Indian power utility Tata Power Ltd said on Thursday it has signed agreements with a consortium of banks to part fund its upcoming 4,000 megawatt power plant in the Western state of Gujarat. Debt from Indian banks and multilateral agencies would account for three quarters of the project cost, which is estimated at $4.2 billion. Tata Power, part of the diversified Tata group, said in a statement the first of the five power units will be set up in September 2011 and the entire plant would be commissioned by 2012.

The power would be supplied to five states, it said. About $1.8 billion would funded via external commercial borrowings from agencies including the Asian Development Bank (ADB) and the International Finance Corp. Separately, the ADB said in a statement on Thursday it has approved a loan for $450 million for the project. Another 55.5 billion rupees ($1.38 billion) would be rupee denominated loans from Indian financial institutions and the remainder would be equity.

Read more in The Economic Times article.

Tatas in JV talks with jet-maker Embraer

Indian conglomerate Tata does not seem satisfied after making history by taking over Anglo-Dutch steel maker Corus and Britain’s premium auto brands Jaguar and Land Rover. It is now considering a partnership with Brazilian aircraft maker Embraer.

Accordin to sources talks were on with Embraer for starting a joint venture for production of aircraft. The world’s third-largest plane manufacturer is unable to cope with orders it is getting from various countries and private players.Tata had offered to set up a joint venture with the aircraft giant, the only firm that makes 120-seater commercial jets.

Read more in The Business Standard article.

Tatas may sell stake in HV Axel, HV Trans

To fund its Jaguar Land Rover (JLR) buyout, Tata Motors, is preparing to divest stake in two of its 100 per cent owned business units — HV Axel and HV Transmission.

According to sources, Tata Motors has been in talks with automotive firms, which include an international transmission giant. The company, according to officials, is unlikely to offload a majority stake in both the profitable subsidiaries.

Deutsche Bank buys 25% in Lodha's SPV

In What could be one of the largest property deals in India, Deutsche Bank Singapore has picked up around 25% stake in a special purpose vehicle (SPV) owned by Mumbai-based developer Lodha Group for Rs 1,700 crore.

The SPV will set up three FDI-compliant real estate projects over 70 acres in Thane and Dahisar. The Lodha group is currently developing as many as 27 realty projects. The deal is believed to be the single-largest FDI in the real estate sector in India by a financial investor till date.

Sources said investment banking firm Trustcap was the advisor to the transaction.In a separate deal, ICICI Ventures has also picked up a 25% stake in Lodha group’s Simtools property in Thane for Rs 100 crore. Early this year, Tata group firm Voltas had sold its subsidiary Simtools to Lodha Developers. The Lodha group is now developing the property as a real estate project. The Deutsche Bank transaction is the third private equity investment in the Lodha group. Apart from Deutsche

Bank and ICICI Ventures, JP Morgan had invested Rs 274 crore in a debt-cum-equity deal in Lodha Bellissimo — a premium residential property, developed at Apollo Mills in Vile Parle, which the group acquired from National Textile Corporation.

Read more in The Economic Times article.

United Phos, Rallis eye $2 bn buy in Japan

Another big-ticket global acquisition by an Indian company is brewing. United Phosphorus and Tata Group enterprise Rallis India are in the race to acquire the world’s largest privately held crop protection and life sciences firm, Arysta LifeScience Corporation, from private equity firm Olympus Capital Holdings.

Sources close to the development said these two Indian companies were among the six contenders for the Tokyo-based firm. The acquisition is expected to cost nearly $2 billion (Rs 8,200 crore), or nearly double Arysta's turnover of 124.1 billion yen (Rs 4,400 crore) last year.

Other bidders include an Israeli firm, Australia’s Nufarm and Blackstone, the global private equity fund.

Olympus has put Arysta on the block and has appointed investment banks Goldman Sachs and Lehman Brothers for the sale. It had bought 8.7 per cent of Arysta in 2002 for around $80 million (Rs 320 crore). Since then, it has been gradually building up its stake.

Read more in The Business Standard article.

TRF to acquire 51% stake in Singaporean firm

TRF, a Tata group company, today said it has entered into an agreement to buy 51% paid -up share capital of YORK Transport Equipment (Asia) from Singapore-based Baker Technology for an undisclosed sum.

The board of directors of the domestic firm at its meeting recently approved the share purchase agreement including shareholders' agreement for the said acquisition in the Singaporean company, as per a release issued by TRF to the BSE.TRF, however, did not disclose any financial details of the deal.

The company is one of the leading provider of engineering equipment, systems and services. It manufactures bulk material handling and processing equipment.

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.

Bharti, Tatas, RCOM officials in Kenya for 51% in Telkom

India’s leading telecom companies are on an African safari. Bharti Airtel, Reliance Communications and the Tatas are in the race to acquire a majority stake (51%) in Telkom Kenya.

Even as these companies refused to confirm the development, it is learnt that their representatives (along with other global telcos) are currently in Kenya as part of the two-day Telkom Kenya bidders’ conference which kicked off in Nairobi on Tuesday.

The India companies will have to compete with other global majors such as British Telecom and Dubai-based Vtel Holding who are also learnt to be in the race. Last year both Bharti Airtel and Reliance Communications had lost the race to acquire a mobile licence in Kenya.

Just last month, the Kenyan government had agreed to double the stake for sale in Telkom Kenya to 51% after repeated requests from potential investors. However, as per the terms specified by the Kenyan government, the successful bidder (over a period of time) would have to reduce its stake to 40% by selling 11% shares to the public.

At the same time, the government will also divest a further 19% to the public. This implies, the final shareholding pattern of Telkom Kenya would be 30% by the government, 40% by the successful bidder and 30% by the public.

Read more in The Economic Times article.

Tatas to pick up 4.6% in DCB

The Tata group will pick up to 4.6 per cent stake in Development Credit Bank (DCB) through its newly-formed subsidiary Tata Capital.

The board of DCB today approved raising up to Rs 310 crore by issuing preferential shares to five investors, including Tata Capital, at Rs 105 per share. This would form 16.6 per cent of the post-issue capital of the bank.

The other investors who will pick up up to 4.6 per cent stake in the Aga Khan Fund for Economic Development (Akfed) promoted bank are UAE-based Al Bateen Investment Co, GRA Finance Corp, Mauritius, DCB Investments, Mauritius and India Capital Opportunities 1, Mauritius.

DCB Investments is a special purpose vehicle floated by Schroders, a UK-based asset management company, to invest in the private sector bank. The preferential allotment is subject to the approval of the bank’s shareholders and the Reserve Bank of India (RBI).

If the RBI approval is not received for any of the proposed investor(s), the board of the private sector bank will have the power to identify and negotiate with one or more investors or with other interested investors for selling the stake and will secure the RBI’s special approval for the same, said the bank.

Read more in The Business Standard article.

Tatas form finance co for bigger spread

Five years after the Tata group merged its finance unit Tata Finance with Tata Motors, the wheel has turned a full circle for the conglomerate. On Tuesday, Tata Sons, the group’s holding company, said it has formed a new firm, Tata Capital, for financial services that will operate in the large growing segments within the finance sector that also include businesses that Tata Finance earlier operated in.

It has also been learnt that segments of Tata Finance that are now operating within Tata Motors, such as asset and vehicle financing, would be spun off into Tata Capital.

Apart from private equity, which has become a buzzword in India due to recent large deals, Tata Capital would also function in capital market services, merchant banking, housing finance, assets and vehicle financing and retail finance.

Read more in The Economic Times article.

Tatas likely to buy out Ryerson stake in TRyL

The Tatas are likely to buy out their partner, Ryerson Tull, US in their joint venture Tata Ryerson Ltd (TRyL).

The move follows Ryerson Tull, US putting itself up for sale in February after Harbinger Capital Partners, its single-largest shareholder, offered to transfer its holding to a slew of candidates to gain board control of the company. Several steel majors and private equity investors, including Arcelor Mittal, are believed to be interested in the steel solutions company.

Several companies have conducted due diligence prior to participating in an auction to gain controlling interest in Ryerson, reportedly valued at around $1.3 billion. Though no deadlines have been set for putting in firm bids, nor any timetable for concluding the auction, reports trickling in suggest that none of the bids was close to the desired valuation.

Read more in The DNA Money article.

Tatas offload 10% in Tata Sky to Temasek

The Tata Group has divested 10% stake in its direct-to-home (DTH) venture Tata Sky to the Singapore government's investment arm Temasek for $56 million.

A source close to the development told PTI that the deal was inked almost a month back. Temasek is likely to make a formal announcement in this regard soon. "Temasek has the option to increase its stake further to the permissible limit of 26%," the source said.

With this move, Tatas' stake in the company has come down to 70%.

Incorporated in 2004, Tata Sky started off as a 80:20 joint venture between the Tata Group and television network Star. The DTH service was launched last year.

The joint venture partners had earlier stated that the project cost for the venture would be around Rs 3,000 crore.

Read more in

The Business Standard article.

Tatas plan umbrella entity for finance arms

The Tatas are working on a proposal to consolidate their financial service businesses under one company.

The group has a host of companies in the financial services space that include Tata Financial Services, Tata Investment Corporation Ltd, Tata Asset Management, Tata Securities, one of which is listed on the Bombay Stock Exchange.

Under the plan, which is still being worked out, there will be a broad group holding company under which the different businesses will be organised as divisions.

It is not clear, however, whether the group’s two insurance joint ventures —one in life and the other in general — with insurance giant AIG will be a part of the consolidation exercise.

Read more in The Business Standard article.

Tatas map realty foray, to develop land of group cos

After big ticket acquisitions in the overseas market, the $22-billion Tata group now wants to expand its presence in one of the fastest growing business spaces in India—real estate. The salt-to-telecom conglomerate plans to develop excess land owned by various group companies through the recently-floated $1-billion real estate fund under the Tata Realty and Infrastructure. The group believes the exercise will help it “unlock intrinsic value” for the benefit of the shareholders of its various group firms.

Bombay House, the group’s headquarters, is learnt to be finalising a blueprint for the new business. The group has hired KPMG to outline the commercial development of land owned the group companies. In the first phase, the group would develop the excess land owned by group companies such as Tata Consultancy Services (TCS),Voltas and Rallis India, said sources close to the development.

TCS, the Tata group’s software company, has around 250 acres of excess land spread across Pune and Hyderabad, while consumer goods company Voltas owns 25 acres in Hyderabad. Rallis India, too, owns 100 acres in the southern city.

Read more in The Economic Times article.

Tata Tea to sell 30% Glaceau stake for $1.2bn

Soft drink giant Coca-Cola today announced it will acquire US energy drink maker Glaceau, in which the Tata Group has a 30% stake, for $4.1 billion.

Tata Tea had acquired 30% stake in Glaceau last year for $677 million, and has decided to sell its stake for $1.2 billion. Tata Tea stock zoomed 4% today to Rs 914.

Tata Tea, in a release issued to the BSE today, said the company through its indirect UK subsidiary Tata Tea (GB) Investments had acquired 25% of the shareholding of Energy Brands Inc, USA ("EBI") and Tate Sons through its subsidiary Tata Ltd (UK) had acquired 5% of the shareholding of EBI. The aggregate consideration for the purchase of this 30% holding was $677 million based on an enterprise valuation of $2.2 billion for EBI.

Coca-Cola Company will acquire Energy Brands Inc, also known as Glacéau, and its full range of enhanced water brands including vitaminwater. The acquisition provides The Coca-Cola Company with a strong platform to grow its active lifestyle beverages.

Read more in The Business Standard article.

Sigma-Vibracoustic JV unveils Rs 75-crore unit

Vibracoustic of Germany, part of the 4.5 billion-euro Freudenberg Group, has stepped up its operations in India by setting up another manufacturing unit in Punjab in collaboration with Sigma India. The new unit has been set up at a cost of Rs 75 crore for manufacturing anti-vibration parts for automobiles. Vibracoustic India, a 50:50 JV between the German group and Sigma Corporation, already has two manufacturing units in Punjab.

The two partners have so far invested Rs 96 crore to set up manufacturing facilities for producing anti-vibration components such as engine mounts, bushings, tuned dampers and hydromounts for auto companies. The JV exports nearly 75% of production and customers include European auto majors.

Sigma Vibracoustic supplies components to global players like Daimler Chrysler, Volvo, Porsche, Ford and General Motors. In India, the Indo-German JV’s customers include the Maruti, the Tata Group and the Mahindras. Among the platforms that use the company’s components include Mercedes E, C & S class and Atego trucks.

Read more in The Economic Times article.

Sitel buys 50% in India JV from Tatas for $22.2 mn

World's second largest BPO company Sitel Corp has bought back its 50% stake in Sitel-India - a JV it had with the Tata Group for $22.2 million.

India's largest IT company Tata Consultancy Services owned 40% stake in Sitel-India which it has sold to Sitel Corp for $17.73 million. Another 10% stake worth $4.5 million has been bought by Sitel Corp from Tata International.

Sitel India was a joint venture between the Tata Group and Sitel Corp, formed in 2000, with both parties holding 50% of the equity. Sitel India CEO Safir Adeni told ET: "The buyback shows that Sitel Global is very bulish on India. We grew at faster than the BPO industry last year and plan to grow faster with this buyback. We will double our employee headcount to 8,000 in India by 2008."

Read more in The Economic Times article

Tata Group forms Tata Realty & Infrastructure with Rs. 4500 crore-fund

The Tata Group has promoted a real estate arm, Tata Realty & Infrastructure, which will invest in infrastructure and real estate projects. The company has a corpus of Rs. 4500 crores. Dinesh Chandiok, the former CEO of Ansal Properties to head Tata Realty, will lead the initiative.Apart from the Tatas, foreign investors too would be sponsors of the fund. There would be different fund schemes for different projects in phases. International Consultancy firm KPMG has been involved in strategizing the Tatas' real estate business. Tata Realty would look at investing in housing complexes, special economic zones and construction of bridges, ports and airports.

Read more in The Times of India article.