October 2007
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3i invests Rs9bn in Adani Power

3i Group Plc, Europe's biggest publicly traded buyout and venture capital firm, is believed to have acquired about 10% stake in Adani Power Ltd., for Rs9bn (US$227mn). Adani Power is a subsidiary of Adani Enterprise Ltd. 3i has made the investment in Adani Power through its subsidiary 3i IIF GP Ltd., which was set up in a partnership agreement with India Infrastructure Finance Company Ltd. (IIFCL) last April. Adani Power is currently implementing a 1,320-MW (4X330 MW) coal-based power plant at Mundra, where Adani Enterprise is planning to build a port-based Special Economic Zone (SEZ). It is planning another plant of similar size at the same location. The project, launched in June 2006, is expected to become operational by 2009 and achieve full capacity by the close of 2010. The total cost of the 2,640-MW project is estimated to be over Rs100bn. [...]

Extramarks to raise $5mn from VCs

Extramarks.com, an online education model that offers ‘after-school’ academic support to students, plans to raise $5-million (around Rs 20 crore) venture capital fund to fuel its growth plans. Promoted by Noida-based international BPO company Cleaveglobal E-Services Limited, the portal is in talks with three venture capital firms and is expected to close a deal soon. According to Atul Kulshrestha, founder-director and chairman of Cleaveglobal, the company intends to utilise these funds to invest in enhancing the existing infrastructure and launching the model in the UK and US in the next six months, besides introducing syllabus for higher education including engineering and curricula of state educational boards. “Our idea is to create a networked community between students, teachers and parents. Students can communicate and interact with their peers across the country, ask questions and answer among themselves, and can even interact with teachers for realtime subject expert guidance,” he said. [...]

GVFL invests in Sahajanand Laser Technology

GVFL, India’s pioneer Venture Capital Company today announced an investment of Rs. 40 million in Sahajanand Laser Technology Limited, India’s one of the largest manufacturers of Laser Systems for Diamond Industry. GVFL will make the investment from its Rs. 296 million Gujarat IT Fund. Sahajanand Laser Technology based in Gandhinagar will be utilizing the funds in the expansion of their range of high – end laser machines. “Picking up innovative technology companies early and nurturing them to leadership is GVFL’s forte. Sahajanand Laser pioneered the laser technology for diamond industry in India. With India emerging as “the global destination for diamond cutting and adding value to small and very small diamond “roughs”, Sahajanand has the potential to become a definite winner with GVFL’s effective nurturing and constant support,” says Mr. Vishnu Varshney, CEO of GVFL Ltd. [...]

Myntra secures seed funding from Erasmic Venture Fund

Myntra, a consumer internet start-up aimed at revolutionizing the personalized gifting and merchandise space in India, announced today that it has secured seed funding from Erasmic Venture Fund and a few other angel investors. As part of the investment, Erasmic has nominated one member to the board of directors. Sasha Mirchandani of Mumbai Angels has also joined the board. The funds will be used for procuring advanced technology for on-demand printing, scaling up the operations, and undertaking new marketing initiatives. “We believe that these funds will help us significantly improve the customer experience and offer best quality personalized merchandise in India” says Myntra CEO Mukesh Bansal. Myntra launched its beta website www.myntra.com in May this year and has undertaken various initiatives to significantly enhance its operational capabilities and online user experience. Myntra now has a fast-growing designer community which has enabled it to publish thousands of unique designs on its website. The company was self funded until now and has built the basic foundation before procuring external funding in this round. [...]

15 firms in race to buy stake in UTI AMC

Companies from US, Europe and Australia are among 15 firms in the race to acquire a stake in India's No. 3 asset management firm, UTI, ahead of an IPO, its chairman said. Asset Management Co, with a corpus of Rs 45,000 crore ($11.4 billion) at the end of September, aims to sell 20% of the firm before the IPO, the first by an Indian asset manager. “We are going to issue 10 million additional shares through private placement,” chairman UK Sinha said. He said companies from US, Europe, Australia, Southeast Asia and the Middle East had approached the fund house for the pre-IPO placement. No company will be offered more than 5%, he said. Sinha said UTI would appoint bankers for the IPO in the first week of November, but did not say how much he expected to raise. [...]

India to launch its seed fund

TiE will rope in VC funds and angel investors. After witnessing a rush of early-stage venture capital (VC) funds and angel investors into the country, the government is taking steps to float a fund to make available seed capital — the earliest stage of funding a business — to entrepreneurs with innovative ideas. This is part of an effort to have a broad programme to foster innovation and take it to global markets. For this, the government is putting together a framework for setting up an innovation promotion council. The fund’s initial corpus of Rs 75 crore will come from the Ministry of Science and Technology. According to information, the Centre is expected to engage The Indus Entrepreneurs (TiE), a network of early-stage VC funds and angel investors with associations in the sub-continent, and Indian School of Business (ISB), Hyderabad. [...]

BP may buy Cairn Energy Plc

Going by the stock movement of Cairn India it is difficult to ignore the reports doing rounds in British media that BP is planning to takeover Cairn India's parent company Cairn Energy Plc. Reports indicate that BP may make 2,800 pence per share bid for the UK based oil company. In the past, BP management has indicated that getting a foothold into India is its biggest challenge. If one is to believe most analyst reports in UK, Cairn is by far the most obvious merger and acquisition candidate in the European E&P sector given that Cairn has a world scale undeveloped resource base in Rajasthan. [...]

PE firm GIP buys 74 pc stake in East India Petroleum

Private equity firm Global Infrastructure Partners (GIP) on Wednesday said it has acquired 74 per cent stake in East India Petroleum Ltd (EIPL). The stake was bought by GIP through a joint venture with Zeus Inframanagement, a company release said here. GIP holds 80 per cent equity stake in the JV with Zeus Inframanagement. The financial terms of the transaction were, however, not disclosed. EIPL is a privately-owned provider of liquid storage services for petroleum, oil and lubricant products, petrochemicals, liquefied petroleum gas and bio diesel. Its facility is located at Visakhapatnam in Andhra Pradesh. Global Infrastructure Management LLC Chairman and Managing Partner Adebayo Ogunlesi said, “EIPL is an outstanding storage asset, well-positioned in one of the premier ports in the second fastest-growing economy in the world – India.” “It also has significant opportunities for growth as energy consumption increases in India and the country builds storage capacity in line with global capacity levels.” The EIPL facility includes twelve storage tanks for petroleum, oil and lubricant products, petrochemicals and bio diesel with a total capacity of 74,000 kilolitres and three storage spheres for liquefied petroleum gas with a total capacity of 8,400 metric tonnes. [...]

Deepak Roy picks up 5% in BDA

Deepak Roy, one-time blue-eyed boy of spirit baron Vijay Mallya, has picked up a 5% stake in Mallya’s arch-rival Kishore Chhabria-led company BDA, makers of Officer’s Choice whisky. Officer’s Choice is the second largest selling whisky brand in the country after Mallya’s UB group owned Bagpiper. This move, according to industry watchers, may trigger off another round of competition given that Mr Roy is seen as a man to contend with in India’s spirit industry. The liquor market hasn’t witnessed any major competitive action after Mr Mallya took over the nearest competitor Shaw Wallace in 2005. Besides the stake purchase, Mr Roy will also take over the management of BDA as its executive vice-chairman and CEO from November ‘07. BDA is an unlisted company. When contacted, Mr Roy and Mr Chhabria declined to comment on the development. Mr Roy who rejoined Mr Mallya in 2002 after a decade-long stint with the world’s largest spirit company Diageo, makers of Johnnie Walker whisky, had left UB group in 2005 over differences with Mr Mallya. Mr Roy had hoped to head the combined UB group spirit business now christened United Spirits. However, Mr Mallya opted to appoint long-time confidante Vijay Rekhi to head the spirit business. [...]

Wockhardt buys Morton Grove for $38 mn

Domestic drug maker Wockhardt said on Wednesday it acquired US-based speciality drugs company Morton Grove Pharmaceuticals, which has annual sales of $52 million. Though the company did not disclose the price, sources in the know said Wockhardt paid nearly $38 million for the Illinois-based company. This ends a long wait for the Mumbai-based drug maker, which had been scouting for acquisition in the US market for over two years, and also brings it closer to its Indian rival Cipla, which had signed a supply agreement with Morton Grove in 2004. This acquisition will allow Wockhardt to expand its operation and product portfolio in the world’s largest pharmaceutical market. Shearman & Sterling, LLP advised Wockhardt on this deal while ABN AMRO represented US-based private equity investment firm GTCR, which holds a majority stake in Morton Grove. [...]