August 2007
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IFCI proposes to sell up to 26% stake

The state-run term lender`s Board will meet on August 4 to begin the process of inviting bids from potential suitors. Barclays is reportedly offering a huge premium. Financial daily reported that the public sector term lender's Board would meet on August 4, to consider inviting bids for the proposed stake sale. IFCI proposes to sell up to 26% stake in the company, and the process is expected to be completed in six months. The newspaper also reported that British bank Barclays is willing to offer a huge premium to yesterday's closing price of Rs52.35. At 11:47 p.m., the stock was quoting at Rs56.65 after hitting a high of Rs57.50. […]

US firm to pick up 25% in Janapriya

Janapriya Engineers Syndicate, a closely held firm credited with building 21,000 units in the affordable home segment in its 20 years of existence, is planning to divest 25 per cent equity to a US-based privately-held real estate private equity company, which is making its maiden entry into India. The offer of stake translates to around $40 million (over Rs 150 crore). The deal is expected to be finalised by next month, according to Janapriya officials. “We have decided to limit our offer to 25 per cent at this stage though the American firm was keen to hold much higher equity in the company,” K Ravinder Reddy, chairman & managing director, said. There has been a growing interest in the Hyderabad-based realty and infrastructure companies among overseas private equity firms in recent times. US-based Citi Venture Capital International (CVC) had recently invested Rs 150 crore in Indu Projects. […]

Indian private equity player lists his pan-Asian fund on the London Stock Exchange

In a remarkable development, veteran Indian private equity player Anil Thadani has listed his private equity fund, Symphony International, in London. The IPO raised $200 million through the issue of 190 million new shares, including $11 million invested by Thadani and his management team. Turning to the equity markets for capital could be a shrewd move given the recent turmoil in the credit markets and the threat of higher future interest rates. Following the capital raising, Symphony will be capitalised at $340 million, taking into account the $140 million the fund is already sitting on. Merrill Lynch was sole bookrunner on the deal. This is the first time that an Asian fund has followed the example of US funds, such as Blackstone which raised $4 billion through an IPO, and KKR which raised $1.15 billion. (Although KKR's share price has since dipped below its IPO price.) […]

India draws top dollar from PE funds

India has emerged the third largest destination for private equity in the Asia-Pacific region in 2007, next only to Australia and Taiwan, both in terms of value and volume of transactions. According to data compiled by research outfit Thomson Financial, PE investments in India during the year have touched $2.49 billion, as against $1.05 billion in Hong Kong , $1.47 billion in Singapore and $752.2 million for the Chinese market. The total PE funding in India is nearly equal to the PE funding that has come into Hong Kong and Singapore together. “The trend of India witnessing higher levels of PE funding than its Asian peers is just a reflection of its growing importance in the global economy. Going forward, we can expect continued buoyancy in both these markets as investors start seeing returns in the backdrop of abundance of high growth opportunities. However, with investors having figured out ways to secure exits from Chinese investments, China may just gain an edge over India,” said Srinivas Baratam, Director, UTI Ventures According to Thomson Financial , 29 PE deals have been struck in India this year, next only to Australia (67) in the entire Asia Pacific region. Though there were 28 PE deals in China, the size of the deals were much smaller. While the average size of the deals in India is $85 million, the deal size in China was only $26 million and $188 million for Australia. India is also a hot-bed for strategic buys, which include M&A activities, with $29.74 billion worth of strategic deals being struck, again the third highest in the Asia Pacific region. While Australia leads the pack with $76.07 billion of strategic deals, China reported $36.88 billion of such deals. There were a total of 331 M&A deals worth $44.34 billion in India in the first seven months of 2007, as compared to 328 M&A deals worth $10.36 billion in 2006. […]

ICICI Venture set to sell Ace stake

ICICI Venture, the private equity arm of ICICI Bank, today signed an agreement with mining and mineral processing company Imerys to sell its 99 per cent stake in Ace Refractories. ICICI Venture acquired the refractory division from ACC in 2005 and subsequently changed its name to Ace Refractories Ltd. The transaction with Imerys is expected to close by month-end. Imerys will acquire the stake from ICICI Venture through its wholly owned subsidiary, Calderys. Both the companies declined to divulge the monetary consideration of the deal. Ace Refractories clocked revenues worth Rs 321 crore in 2006-07 and it is the second largest refractory company in the country. […]

Venture funds cut realty exposure

The Bombay Stock Exchange may have well begun to realise the importance of real estate sector and introduced the realty index, but venture capital investors have been moving away from the realty by trimming allocations to the sector by 31% since the beginning of the year. Venture Capital Funds (VCF) and Foreign Venture Capital (FVC) investors have been realigning their investments by reducing inflows into real estate, information technology, telecom and industrial products sectors. In contrast, investments have been piling up in the services, media and entertainment, biotechnology and pharma sectors. However, the total investments in the country have shot up by 67% to Rs 20,310 crore as on June 30, 2007, from Rs 12,127 crore as on September 30, 2006, according to data from Securities and Exchange Board of India (Sebi) on 88 VCFs and 66 FVC investors registered with the regulator. […]