Control Issues: A Miffed Bharti Pulls Out Of Talks With MTN
In a significant development, Bharti Airtel has decided to call off its talks with South Africa’s MTN. The deal has failed to make any breakthrough as both the parties could not reach an agreement on the control and other structural issues.
The Bharti group issued a statement saying MTN has presented structure that was not acceptable to it. The new structure suggested by MTN envisaged “Bharti Airtel becoming a subsidiary of MTN and exchange of majority shares of Bharti Airtel held by the Bharti family and Singtel, in exchange for a controlling stake in MTN”. Bharti believes that “this convoluted way of getting an indirect control of the combined entity would have compromised the minority shareholders of Bharti Airtel and also would not capture the synergies of a combined entity”.
The decision to pull out of the talks was prompted by this, and that is the end of what could have been the largest foreign acquisition by an Indian company.
Dhoot’s Mobile Gamble: Videocon In Talks To Buy Motorola’s Handset Business
Consumer electronics major Videocon is aiming another big global buy. The Indian company, promoted by the Dhoot family, is likely to buy out the handset business of US based Motorola Inc. The talks are at initial stages, though. Motorola’s handset business has a market share of 15 per cent globally and is valued at $ 3.8 billion. The business has been suffering losses and earlier this year Motorola decided to separate its handset business from its profitable broadband and mobility solutions business.
Credit Suisse To Acquire Chennai NBFC, Double I-Banking Team
A non-banking finance company (NBFC) is a key to every investment bank (or broking firm’s) growth in India. The latest to join the bandwagon is Swiss investment bank Credit Suisse. The bank is reportedly in the process of acquiring a majority stake (91 per cent) in a Chennai-based NBFC, Bokdia Marketing and Finance, reported The Economic Times. It will be via a fresh share issue, the report added. It will use the NBFC for its corporate finance operations and private banking
It’s not Credit Suisse alone bullish about NBFC business. Interestingly, Chennai has been the major source of NBFC deals in India with most of the M&A in that space belonging to the South Indian city. Temasek acquired Dove Finance a couple of years ago, while Goldman Sachs recently bought a stake in Shriram Credit. Edelweiss Capital recently received Rs 150 crore funding from Singapore GIC, while Karvy Stock Broking is in the process of acquiring an NBFC. India Infoline recently kicked off its NBFC business mainly for lending to corporates to fund buy backs by promoters.
Irish Firm CRH Buys 50% In Hyderabad Cement Maker My Home For Rs 1,875 Cr
In the costliest deal in the Indian cement industry yet, Irish building materials firm CRH has bought a 50 per cent stake in Hyderabad-based cement manufacturer MyHome Industries Ltd (MHIL) for Rs 1,875 crore. The deal is valued at $235 per tonne. In a release by CRH, the multinational company said it has acquired a 45 per cent shareholding in the privately held MHIL in the first phase. The second phase of the transaction for the remaining 5 per cent shareholding is expected to be completed in the next three months.
The most expensive deal till now was when Holcim, worlds largest cement maker paid $200 per tonne to Ambuja Cements in 2005. The deal values MHIL very highly as the current valuation to buy cement plant in India is $150 per tonne.
Mayfield Raising $150 Million India Dedicated Fund
Close on the heels of Battery Ventures announcing an India partner to be based in Mumbai (see our post), here is another Silicon Valley based fund drawing up its India dedicated fund plans. Mayfield Fund is raising up to $150 million for its first India dedicated fund, PEHub reported, quoting a regulatory filing.
Mayfiled has already secured $75 million from limited partners like Skandia Life Insurance Co., Adveq and Industriens Pensionforsikring for this fund, the report said.
Mayfield has investments in india such as Tejas Networks, IL&FS Investsmart, Suzlon and India Infoline. The fund is looking at infrastructure ancillaries, manufacturing, consumer services, technology and technology-enabled services sectors.
An India dedicated fund will help the fund scale up its investments in India. Mayfield has two partners - Nikhil Khattau and Vikram Godse - based in Mumbai and Navin Chaddha, a General Partner, based out of Silicon Valley. Three are focused on India investments.
Indians-Backed CBaySystems To Raise $123M PE To Fund MedQuist Buy
Indian-founded healthcare BPO firm CBaySystems Inc needs more than a helping hand from PE funds to complete its transaction with MedQuist, the world’s largest medical transcription company. CBay, founded by Indian entrepreneur Raman Kumar and in which India’s Godrej Group has a 15 per cent stake, will sell a 53 per cent stake to UK-based S.A.C. Private Capital Group (SAC) and US-based Lehman Brothers for $123 million. This will be used to fund its $285 million acquisition of a 69.5 percent in the Philips-controlled MedQuist. CBay would pay $11 a share for Philips’ stake in Medquist. Philips of Amsterdam paid $1.2 billion for 60 percent of MedQuist in 2000.
BNP Paribas Pays $10M To Geojit For Surrendering Commodity Bourse Tickets
BNP Paribas is now compensating Geojit Group for surrendering its commodity exchange membership. According to a stock market disclosure, the French banking group will pay Rs 40 crore ($10 million) to Geojit Commodities Ltd (GCL), a wholly owned subsidiary of public listed firm Geojit Financial Services, in consideration of surrendering its membership of the commodities exchanges.
In another disclosure, Geojit Financial Services also announced that BNP Paribas will pick up a 35 per cent equity share capital of Geojit Technologies Pvt (GTPL) for Rs 60 crore. GTPL is a wholly owned step down subsidiary of Geojit Financial and is engaged in IT software development and services.
UTI AMC Plans $600 Million Infrastructure Fund
UTI Asset Management Company has reportedly raised $600 million (Rs 2,400 crore) for private equity investments in infrastructure companies and projects. It has raised the money through its subsidiary UTI International, in association with Japanese commercial bank Shinsei and German bank specialising in financial services for the transportation sector HSH Nordbank, according to The Times of India.
Industry sources, however, told VC Circle that UTI AMC is still in the process of raising the fund, and the fund is not near the closure any time soon. UTI AMC is also the sponsor of UTI Ventures, the Bangalore-headquartered private equity fund.
How Arjun Murti Has Made Commodity Analysis A Fashionable Career To Pursue
Arjun N Murti is the most talked about analyst on the globe today. The Goldman Sachs analyst tracks oil, and has now made commodity analysis a sexy career to pursue in finance. Murthi’s recent claim to fame is that he has predicted oil will cross $200 per barrel very “soon”. The oil prices have already shot up to $135 a barrel.
Murthi, 39, is no pushover. In 2004, the New Jersey-born Indian had predcited that oil would cross $100 a barrel, a prediction which many of his detractors scoffed at then. The crude was then trading at a modest $40 a barrel. Murthi clearly had his finger on the oil pulse. As the crude breached the $100-mark in March the following year, many of his critics had to shut up.
SIDBI Venture To Raise Third Fund; Bigger Than Rs 500 Cr Previous Fund
SIDBI Venture Capital Ltd, the venture capital arm of Small Industries Development Bank of India, will raise its third fund in the next two months, a top official of the firm told VC Circle in an interview. The size of the fund is not disclosed, but it will be bigger than its second fund of Rs 500 crore. The new fund will have two closures and it will also have two components - domestic and offshore.
SIDBI Venture Capital is currently working out of its Rs 500 crore-SME Growth fund which it raised in 1999. “We have already deployed 80 per cent of our fund (in 20 companies), and have kept 20 per cent for follow on investment commitments. We will be raising a SME focused fund in another two months. This will be a significant fund for the SMEs,” Ajay Kumar Kapur (in the picture), CEO of SIDBI Venture Capital told VC Circle.
Idea Cellular Arm Gets $640 Million From Providence Equity
Idea Cellular Ltd, the mobile cellular company owned by Adity Birla Group, has received another round of private equity investment from Providence Equity Partners. In an announcement to the Bombay Stock Exchange, Idea Cellular informed that Aditya Birla Telecom Ltd (ABTL), a wholly owned subsidiary of the Pune-headquartered company, has issued compulsorily convertible preference shares to the private equity fund for an aggregate sum of $640 million. DSP Merrill Lynch was the advisor in the transaction for Idea Cellular.
These shares would be converted into 20 per cent of equity share capital of ABTL post dilution, the announcement said. The deal values ABTL at $3.2 billion. The investment is subject to the receipt of regulatory approvals, including the approval of the FIPB, the release said.
Battery Ventures Appoints Gautam Patel As India Partner
Finally, Battery Ventures, a Silicon Valley based venture capital firm, has got a man on the ground in India. The venture fund, which has been investing in India since 2004, has appointed Guatam Patel as a partner focused on investments in India. Patel was earlier head of European operations for iGate, a business process outsourcing and IT services company. Patel will initially work out of Battery’s Silicon Valley office. He will move to Mumbai in the second half of the year.
Battery’s India investment team already has Ramneek Gupta (senior associate) and Mark Sherman (General Partner), both based out of Silicon Valley. Gupta will join Patel in the later part of the
SIDBI Venture Invests Rs 30 Crore In Drug Maker Centaur Group
SIDBI Venture Capital Ltd, the private equity arm of Small Industries Development Bank of India, seems to be on a deal overdrive. Close on the heels of its Rs 30 crore ($7.5 million) investment in Chennai-based adhesives and sealants maker Anabond, the SME-focused private equity fund has announced the investment of a similar amount in Centaur Group.
Centaur group, founded by first generation entreprenuers S.D. Sawant and Dr Shrikant Sawant, owns two companies - Centaur Pharmaceutical and Centaur Chemicals Pvt. Ltd, which will be merged soon. Centaur Pharma makes drugs related to respiratory, ophthalmic, pain management, nutrients, gastrointestinals and anti-infective segments. It makes a formulation called Sinarest, which has a significant presence in the anti-cold segment, and Occurest, a brand leader in the ophthalmic decongestant market.
SIDBI Ventures Invests Rs 30 Crore In Adhesive Maker Anabond
Anabond Ltd, a Chennai-based manufacturer of industrial adhesives and automotive sealants, has received Rs 30 crore funding from SME Growth Fund of SIDBI Venture Capital Ltd.
Anabond is into manufacturing of industrial adhesives and automotive sealants for the engineering industry, and claims to have more than 50 per cent market share in those segments. The company has also entered consumer market through super glue adhesives. Anabond was set up in 1979 by J Vijayakumar and A. V. Ramanujam, who were working for Department of Atomic Energy, before starting Anabond.
Why Is Standard Chartered Considering An Indian Listing?
This could be a first for a foreign bank in India. Standard Chartered, the largest foreign bank in the country, is looking to list itself on the local stock exchanges. This could also turn out to be the first MNC to issue Indian Depository Receipts (IDRs)—which are securities that can be traded in the local stock market.
According to a report in The Economic Times, the plan could partly be driven by banks in India fetching a better stock market valuation. If StanChart actually comes with a IDR, it would be its third global listing after the UK and Hong Kong. The bank has already sounded out market regulator Sebi for the IDR listing.
HP’s Photo Printing Site Snapfish Acquires Merasnap.com
Probably this is the beginning of consolidation in the Indian web 2.0 space. Snapfish.com, Hewlett & Packard-owned online photo printing site, has acquired an Indian online photo printing website MeraSnap.com. The acquisition amount is not revealed. MeraSnap is a subsidiary of Knowledgeworkz Consulting, an information management company based in Bangalore, which provides email newsletter management services.
Kotak Mahindra Hires Hasan Askari For Global Buys, Expansion
Kotak Mahindra Bank, the former local partner of investment bank Goldman Sachs,
has brought on board a senior global financial executive to spearhead its international initiatives. The Mumbai based bank has appointed Hasan Askari, an investment banker and former member of the executive committee at Old Mutual, as an advisor with a mandate to expand the group’s business globally, including potential acquisitions. He will be based in Europe, and will be closely involved in expanding the Kotak Group’s global operations.
Uday Kotak, Executive Vice Chairman and Managing Director, Kotak Mahindra Bank Ltd, had this to say about Askari’s appointment: “(It) reflects our commitment to playing a more prominent role in the global arena.”
Apollo Health Street To Sell 8.5% To Healthcare Investment
India largest healthcare company, Apollo Group, is planning to sell 8.5 per cent stake in its BPO arm to Healthcare Investment (HIL), a Mauritius based investment firm, for Rs 61 crore. The pre-IPO deal values Apollo Health Street (AHS) at around Rs 700 crore. AHS will allot 2.3 million shares or compulsorily convertible equity shares to Healthcare Investment at Rs 260 apiece.
The funds would be used by AHS to repay the debt it had taken to acquire US-based BPO Zavata and to expand its facility in Chennai, reports The Economic Times. AHS is readying an IPO which will see a total dilution of 20 per cent to raise about Rs 160-170 crore.
Bahrain’s Khaleeji Commercial Bank Launches $163.5M India Real Estate Fund
Khaleeji Commercial Bank (KHCB), one of Bahrain’s leading Islamic banks, has announced that it has raised $163.5 million for a real estate investment company focused on India. The fund - named Danat India Investment Company - will invest in an unnamed real estate development project near New Delhi, India’s capital. The development is targeted at the expanding middle class of India.
The funds have been raised from investors across the GCC states. This is Danat’s first foray into Indian subcontinent. Ebrahim H Ebrahim, CEO, Khaleeji Commercial Bank, said, “With a target return on investment of 83 per cent over a three-year period, Danat seeks to address the demand for middle income residential properties…” Continue Reading »
CDC Commits $650 Million To Actis’ Third Emerging Markets Fund
It was only in January, CDC Group, the UK government-backed private equity emerging markets fund of funds investor, committed $1 billion to a new emerging markets infrastructure fund, managed by Actis, to make investments in Africa, South and South East Asia, and India.
In less than a span of six months, CDC Group has again commited $650 million to Actis’ third series of funds for investment across emerging markets – Actis Emerging Markets 3 LP. The series of funds comprises a Global Fund and four regional investment pools targeted at Africa, South Asia, China and Latin America.
As Merger Wave Peaked Last Year, 2008 May Be The best Time For M&A
If you are looking at making an acquisition, there may not be a better time than today. According to a study done as part of Towers Perrin/Cass Business School research project, 2008 may be the best time to do an acquisition. They suggest that over the last two merger waves, deals done in the year following the peak create more shareholder value than those completed during the upswing and peak years of the wave. The results of the study, which analysed 38,122 deals (only 100 per cent acquisition were considered) over the last nine years, found that 2007 was the peak year of the current merger wave, suggesting 2008 remains a good time to proceed with a deal.
According to the study, companies have created rather than destroyed value in the current deal wave, in contrast to the prior two cycles. The evidences in the report indicate that this trend will continue, suggesting that the post-peak year in the current merger wave will also add value.
Thomas Cook Enters Highly Competitive Online Travel Mart
This may not be so pleasing news for half a dozen VC-funded travel portals in India. Thomas Cook India, one of the most popular offline travel companies, has made its entry into the online space with www.thomascook.in. Online travel is one category that has been proved to be successful in India. It is expected to grow to the size of $2 billion in merchandise value by 2008.
The market is currently dominated by MakeMyTrip.com, Yatra.com, ClearTrip.com, and several others like Travelguru (hotels portal) and ezeego1.com. Continue Reading »
Poonawala Firm Acquires Stake In Orchid Chemicals; Will Ranbaxy Back Off?
Orchid Chemicals, the Chennai-based pharma company in which Ranbaxy promoter group firm was attempting a “raid” by acquiring a 14 per cent stake from open market, seems to have got a new suitor. The new investor is believed to be acting in concert for the Pune-based Poonawala group.
According to a stock market disclosure made on Friday Pune-based Adurjee & Bros has accumulated a 7.22 per cent stake in Orchid Chemicals through open market transactions. This stake is worth over Rs 125 crore.
Orchid was in news recently after a Ranbaxy group partnership firm Solrex acquired over 14 per cent stake and came close to the trigger point for a mandatory open offer as per the takeover norms. Last week, the firm disclosed that a set of investors have picked more than 7 per cent stake. Continue Reading »
Konaseema Power To Sell 17% For Rs 500 Crore To IDFC, Lehman
Konaseema Gas Power (KGPL), the Andhra Pradesh based power utility company, may sell nearly 17 per cent stake to private equity majors Lehman Brothers and IDFC Project Equity, reports The Economic Times. The company has been valued at Rs 3,000 crore and may sell the stake at Rs 500 crore.
Out of the Rs 500 crore stake, Lehman and IDFC may pick up stakes worth Rs 300 crore and Rs 200 crore, respectively. The funds are expected to finance the second phase of the KGPL plant construction, the report said. Continue Reading »
Chartered Accountants Will Be Allowed To Advertise Services; Will Lawyers Be Next?
It’s good news for Chartered Accountants, and also for publications like ours. CAs have been finally allowed to advertise their services after a council meeting of Institute of Chartered Accountants of India (ICAI), the apex body of CAs in India, decided in favour of the move, according to a report in Mint. CAs can now use print and electronic media to showcase the different services being offered by them, especially those that are not in their exclusive domain, such as risk management and consulting. Also CAs can now promote both their individual services and also the name of their firms. Continue Reading »
LN Mittal Set To Buy Bulgaria’s Largest Steel Maker From Brother Pramod
LN Mittal is all set to strike another deal. This time, Mittal would be grabbing the ailing Bulgarian steel maker Kremikovtzi from his brother Pramod Mittal who heads Global Steel Holdings. ArcelorMittal, the world’s largest steel maker, who has been fighting Ukrainian business tycoon Konstantin Zhevago’s Vorskla Steel, has reportedly emerged the preferred bidder for Kremikovtzi. Sources close to the development told VC Circle that the deal is yet to be sealed. Merrill Lynch, which advises Pramod Mittal on sale, is holding talks with both the Vorksla Steel and ArcelorMittal to fetch the best price for the seller. Continue Reading »
Ved Prakash Arya’s Milestone To Raise Rs 1,000 Crore Domestic Real Estate Fund
Indian real estate fund Milestone Capital Advisors is raising a new fund, Milestone Domestic Scheme–II, which will have a corpus of Rs 1,000-crore or roughly $250 million. The firm, founded by Ved Prakash Arya, a former manager at Pantaloon Retail, will focus on investing in emerging real estate markets, particularly the tier-II and tier-III cities and towns. The fund, registered with Indian market regulator Securities Exchange Board of India, is hoping to attract investors by offering a potential return of 25-30 per cent. According to a report, which quoted Arya from a press conference in Chennai, the fund would deal in land layout and plotted development besides developing residential and warehouse projects. Close to 40 per cent of the fund would be for layout development and the rest for warehouse and residential projects. Continue Reading »
Babcock & Brown Long On Housing; Weighs Hotels, Plane Leasing Too
Babcock and Brown, Australia’s second largest private equity fund, is ready to invest in Indian real estate and infrastructure sector. Although real estate prices are falling and infrastructure project costs are rising, the firm is unfazed. Babcock is betting on the high population growth and the resultant demand for more houses in India.
“In India and China, population growth is underpinning long-term demand. There is strong demand for rental accommodation and quality homes, and sophisticated financing is driving this demand,” Michael Maxwell, a key management committee member of Babcock and Brown Ltd, told Mint in an interview. Continue Reading »
Angels Back A Bangalore Company That Converts Text To Reports
Exclusive: Textual Analytics Solutions(TAS), a Bangalore-based text mining company that promises to make the life of information intermediaries easier, has landed funding of $250,000 from Mumbai Angels and Harsh Saksaria (whose Mumbai based family is into construction business). Prior to this round, TAS received $650,000 from a group of angel investors which included Ashish Gupta and Kanwaljit Singh (both managing directors of Helion Venture Partners), Rajiv Sahaney (Managing Partner of New Vernon Advisory Services), and Silicon Valley Bank. Continue Reading »
DE Shaw To Provide Rs 100 Crore Convertible Debt To Amar Ujala
Investment firm DE Shaw is close to providing Rs 100 crore debt to Amar Ujala Publications, a Hindi language newspaper publishing company, reports Mint. The funds will be taken in as debt, and can be convertible into equity.
DE Shaw Composite Investment (Mauritius) Ltd Pcc already holds an 18 per cent stake in the newspaper company, which publishes Hindi daily Amar Ujala. As the Indian laws restricts Foreign Direct Investment in a newspaper publishing company to 26 per cent, how much of Rs 100 crore would be worth in future equity will only be worked out later.
DE Shaw had valued the publication at Rs 650 crore in July 2007. The 18 per cent stake came in for an investment of for Rs 112 crore. What is intertesting is while the stocks of listed media companies have slid along with correction in the stock market, the private equity firms still offer a premium to the firms in this sector probably because there are not many firms up for grabs.
Deal Roundup: Topsgrup, Actis Biologics, Phoenix Mills
In the first overseas buy from security solutions industry, Mumbai-based Topsgrup has acquired 51 per cent stake in a security solutions company in UK. The company has not disclosed any details in the equity buyout. The group has also bought out Banglore-based Guardwell Private Detectives Ltd for Rs20 crore. After the acquisition Topsgrup will become the second largest security provide in southern India, providing a wide variety security solutions under one roof. Continue Reading »
Educomp Acquires 51% In Learning.com For $24.5 Million
Educomp Solutions Ltd, the publicly listed IT-based learning company, continues with its aquisitive led growth. The Delhi-based company has acquired a 51 per cent stake in Learning.com, a US-based provider of web-delivered curriculum and assessment, for $24.5 million. The deal includes the purchase of existing shares as well as an infusion of new capital into the company.
Learning.com, founded in 1999, serves nearly 2 million students in the US. It has solutions like EasyTech, a K-8 technology literacy curriculum that helps students develop and apply technology skills in math, language arts, social studies, and science, and other products like TechLiteracy Assessment (a tech proficiency assessment tool) and Aha!Math (an interactive K-5 supplemental math curriculum). Continue Reading »
Buyout Funds Rush To India And China: Capital International Raises $2.25B Emerging Markets Fund
Capital International, the UK based buyout arm of the US-headquartered Capital Group, has closed a $2.25 billion emerging markets private equity fund to invest in countries like India, China, Russia and the markets in Latin America. The money has come in from more than 70 institutions, including the Pennsylvania Public School Employees’ Retirement System and Lockheed Martin Corp.
This is the fifth fund of Capital International (christened as Capital International Private Equity Fund V or CIPEF V), and is four times the corpus of its previous fund. The investments targeted will be in the range of of $50 million to $250 million in companies across various regions and industries. The fund has already committed more than 25 per cent of its capital in six companuies - including Arcos Dorados, McDonald’s restaurant operations across Latin America and Unimilk, the second-largest dairy products producer in Russia and Ukraine. Continue Reading »
RBS Realigns Top Talent From ABN Amro; Barclays Too Tap Into ABN
As India emerges as one of the top destinations for M&A practice in the world, there is a severe catfight going on for talent in the investment banking business. Royal Bank of Scotland (RBS), which acquired ABN Amro Bank last year, has hired three key people from the Dutch bank for Indian investment banking operations. At the same time, Barclays Capital poached five senior managers of ABN to head up their investment banking operations in the country and elsewhere.
RBS has appointed Manoj Agarwal as head of global corporate finance for India, Anjani Kumar as head of M&A operations, and Dilip Kadambi as head of equity capital markets business. This seems to be part of RBS’s integration process with the Dutch bank. So this is probably more like a realignment of work force.
Menon is currently based in Hong Kong, where he handles financial sponsors-led M&A advisory in Asia. Kumar moves from ABN’s M&A advisory group in London, while Kadambi currently works in ABN’s ECM business in India. Besides, RBS has also hired Varsha Valecha, who was a business leader in ABN’s India ECM team. Valecha has also worked with Enam Securities. Continue Reading »
Loss-Making Kinetic Motor Seeks Buyout Funds
Two-wheeler maker Kinetic Motor is talking to both strategic and private equity investors to raise about Rs 150 crore. News reports had earlier stated that M&M is in talks to acquire the two wheeler firm owned by the Firodias.
According to a report in Mint, the Firodia family is not averse to becoming minority stakeholders though they want to retain at least 26 per cent stake. This is to focus more on their auto component business which is now under another listed firm Kinetic Engineering. Promoters hold about 55 per cent of Kinetic Motor through personal holdings and group firms. Continue Reading »
Godrej, Videocon Weigh GE’s Move To Shed Its Appliances Business
Following General Electric Co.’s announcement to sell, spin off or seek a partner for its large appliance unit, Indian durable makers — the Godrej group and Videocon — have been narrowed down as possible bidders for General Electric’s appliances division, reports the Economic Times.
Leading investment bankers UBS, JPMorgan and Goldman Sachs, which have been hired to explore options and conduct an auction, have narrowed down the two leading players in the Indian consumer segment. Continue Reading »
Zeus Numerix, IIT Bombay Incubated Firm, Gets $500K Seed Funding
Zeus Numerix Pvt Ltd, an engineering design services company incubated at IIT Bombay, has received Rs 2 crore ($500,000) funding from a group of high-net worth individuals led by investment bank Saltrock Advisors Pvt Ltd. Zeus is founded by a group of IIT-B professors and students. The company has the backing of 10 years of R&D at Dept. of Aerospace, IIT Bombay.
Zeus was founded in August 2004, and it specialises in computational fluid dynamics (CFD) tools and services. It has a global customer base across a diverse set of industries, including aerodynamics, automobiles, missiles/rockets, nuclear reactors and buildings, electric fans & motors etc. The company owns a proprietary platform and series of intellectual property in this domain. According to a release issued by the company, Zeus Numerix had been profitable since its inception, and had risen from a revenue base of Rs 20 lakh in 2004-05 to Rs 2 crore in 2007-08. Continue Reading »
Mukesh’s Partnership Model: Vornado For Real Estate, Four Seasons Or Accor For Hotels
Mukesh Ambani led Reliance Industries is foraying into the real estate and hospitality sectors with a $1-billion joint venture with the NYSE-listed Vornado Realty Trust. The JV, which is likely to have a non Reliance man as the head, will set up a real estate fund that will develop a network of mega malls and highway shopping centres in India, not just for its in-house retail firm Reliance Retail but also for others.
The oil & gas and retail company, India’s largest company by revenues, is also in talks with the Canada-based Four Seasons Hotels and French group Accor to set up hotels at some of its properties in Mumbai and Ahmedabad, according to a report. Continue Reading »
Cobra Beer Uncorks Three-Year Exit Plan To Entice Investors. Any Takers?
Cobra Beer, the UK headquartered alcoholic beverages company founded and managed by the India-born British millionaire Karan Billimoria, may be sold lock, stock and barrel in the next three years, the UK’s Sunday Telegraph reported. This move was revealed in marketing documents of the company used to convince financial institutions to back the company. That would answer the question on exit route for private equity firms who are looking to invest in the firm.
According to the documents, a sale is expected in the next three years - a “full exit in 36 months”. And that could be a trade sale to one of the big brewers or drinks companies. The company has identified “obvious buyers” like South Africa’s SABMiller, Russia’s InBev (in which Delhi-based Sun Group is a shareholder), Molson Coors, Carlsberg and Anheuser-Busch, besides Heineken, and certain Indian-owned companies (Vijay Mallya’s Kingfisher, anyone?) also as “possible buyers”. Cobra has given the mandate to N M Rothschild and City Capital Corporation as advisors. Continue Reading »
KPMG’s Pradeep Udhas Joins Greater Pacific Capital As India MD
A leading UK-based private equity firm, Greater Pacific Capital, has hired an investment banking veteran to head up its India office. Pradeep Udhas, one of the founding partners of KPMG India, has quit the consulting firm to join the PE fund, according to a report in The Economic Times. He will be one of the five managing directors of the London-based fund, and will be located in Mumbai.
Udhas joins the likes of Amit Chandra, Rajeev Gupta and Munesh Khanna who all left investment banking careers to join various global PE funds. Continue Reading »
Three Indian Brokers Said To Be Interested In UK Broking Firm Arden Partners
Indian broking houses are now looking at overseas markets for expansion. Close on the heels of Religare’s acquisition of London’s oldest stock broking firm Hichens, Harrison & Co for £55 million, there is one more deal brewing in the UK. At least three Indian broking firms houses - Indiabulls Securities, Kotak Securities and Enam Securities - are reportedly in race for acquiring Birmingham-based stockbroker Arden Partners.
The UK firm is a research-led institutional stockbroker focused on small and mid cap firms, and listed on London Stock Exchange’s Alternative Investment Market (AIM), with a market value of £31.12 million. It has offices in London and Bristol, apart from Birmingham. Continue Reading »
IL&FS Investsmart: SAIF Partners To Exit; Edelweiss Missed Out On The Deal
Private equity fund SAIF Partners, which owns 12 per cent stake in IL&FS Investsmart, will exit the company through the open offer to abe announced by the acquirer HSBC Plc. The British banking giant, on Saturday announced that it would acquire 73.21 per cent stake in Mumbai retail broking firm IL&FS Investsmart for $241.6 million (at a price of Rs 200 per share). The sellers are the promoters of the company, E*Trade (43.85 per cent stake) and IL&FS (29.36 per cent). IL&FS will also get $19.4 million as three-year non-compete fee. HSBC is likely to announce the open offer for 20 per cent shares early next week. Sources told VC Circle SAIF Partners will participate in the tender process (open offer), which is expected to be announced next week.
SAIF Partners had acquired shares in IL&FS Investsmart at close to Rs 50 a share three or four years ago. The exit will give the PE fund about 4.5-5 X returns. Continue Reading »
HSBC Buys Out E*Trade, IL&FS For $261M From Broking Firm IL&FS Investsmart
In one of the largest M&A deals in the Indian broking space, HSBC has announced that it would acquire a 73.21 per cent stake of IL&FS Investsmart in an all-cash deal for $261 million (Rs 1,070 crore). IL&FS Investsmart is co-promoted by IL&FS and US online brokerage firm E*Trade, who have exited in the deal.
HSBC is acquiring the stake from both the key promoters. HSBC, via its subsidiaries, will acquire 43.85 per cent from E*Trade and a 29.36 per cent from IL&FS for $241.6 million at a price of Rs 200 per share. Besides the deal value, HSBC will also pay Mumbai-based IL&FS an additional $19.4 million as part of a three-year non-compete agreement. Since IL&FS Investsmart is a listed company, HSBC will have to make a mandatory open offer to acquire up to 20 per cent additional shares.
VC Circle was the first to report about E*Trade exiting the Indian broking house following a hit it took after the subprime crisis in the US. Continue Reading »
Infrastructure Investing Turns Fashionable: Latest Entrant KKR
As the global economy is still reeling under the subprime crisis, infrastructure investing is becoming fashionable globally. Soon after Morgan Stanley and Global Infrastructure Partners (a PE firm backed by Credit Suisse and General Electric) announced almost $10 billion worth funds for infrastructure, here is one of the largest PE firms in the world, Kohlberg Kravis Roberts & Co., announcing its entry into the business of investing in roads, bridges, ports and flyovers.
The New York-based firm said it would invest in infrastructure assets worldwide. It has also hired George Bilicic from investment bank Lazard to head up this initiative.
Bilicic has been quoted as saying by TheDeal.com that there is a need for deployment of capital in sectors including electric and gas utilities, water, transportation (including roads, bridges and tunnels), gas pipelines and airports. “Across the economy and across nations, there’s a fundamental need for this asset class,” Bilicic told the website. It’s not clear how much it will set aside for the infrastructure initiative. Continue Reading »
Sequoia-Backed Sai Advantium Lands $20M From MPM Capital
MPM Capital, the largest venture capital investor dedicated solely to healthcare, has made a $20 million investment in Hyderabad-based Sai Advantium Pharma, a chemistry-driven drug discovery and development service company. This is the first investment by MPM Capital in India.
As part of the deal, MPM Managing Director William Greene is joining Sai Advantium’s Board of Directors. In 2007, Sequoia Capital had picked up a minority stake in Sai with an investment of $12.5 million (as reported first by VC Circle) .
MPM intends to help the company tap biotech firms in its own network, besides big pharma companies with which it has strong relationships. The global preclinical discovery and development outsourcing industry is poised to grow to $20 billion by 2010. Continue Reading »
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