November 2007
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Merrill Lynch bought stake in seven real estate projects

DLF, India's largest real estate developer by market cap, on Monday said it has sold 49 per cent stake in some of its residential projects to private equity investors for a total consideration of Rs 1,675 crore. Merrill Lynch & Co has bought 49 per cent equity in seven residential projects in Chennai, Bangalore, Kochi and Indore for Rs 1,481 crore, DLF said in a communique to the Bombay Stock Exchange. The mid-income housing projects would get fully developed in about 7-8 years, it added. [...]

Gitanjali buys US-based Rogers for $18.5 mn

Jewellery maker and retailer Gitanjali Gems Ltd has bought US-based jewellery chain Rogers for $18.5 million, its top official said on Monday. “A further investment of $20 million will be made,” Chairman Mehul Choksi said. The Indian firm bought the entire stake in Rogers, which operates 46 stores and had revenue of about $80 million, it said in a statement. In December 2006, Gitanjali had bought a 97 per cent stake in another US-based retailer, Samuels Jewelers Inc. (ET) [...]

WPP Digital acquires 75% stake of Quasar

WPP Digital on Monday announced that it has acquired a 75% stake in the share capital of Quasar Media Private Limited, one of Indias's leading independent digital marketing and web solutions agencies. Founded in 2005, Quasar offers clients a fully comprehensive range of specialist digital skills including digital media, creative, ebusiness solutions, search marketing and optimization, mobile marketing, ecommerce, social media and eCRM among others. Based in New Delhi, with offices in Mumbai and Bangalore, Quasar employs 73 people. Clients include LG Electronics, MakeMyTrip.com, Microsoft, Monster.com, VISA, Motorola, Zapak and Airtel. Quasar will continue to be managed by its founding team, led by CEO Harish Bahl and Manish Vij, Chief Business Officer. Revenues for the year ended 31 March 2007 were INR 103.6 million with gross assets at the same date of Rs149.5mn. [...]

Argonaut to invest Rs 30 cr in Vallabhdas Kanji

The whiff of global private equity is percolating to each and every sector and corner in India. Argonaut Partners, the Massachusetts-based private equity firm with $2 billion under management, is investing Rs 30 crore in Kochi-based Vallabhdas Kanji Ltd, one of the largest spices exporters in Asia. Both companies could not be reached for their comments. VKL is the Rs 150-crore flagship company of the $100 million Kanji Moorarji Group, which includes Kancor Flavours and Extracts and Autohangar Indi. Kanji Moorarji is a well-established name known for its quality in the spice trade. This is the second round of investment the firm is securing after the $6 million it received from UTI Ventures during November 2006. VKL has significant interests in flavours and extracts, and exports to over 40 countries. VKL is a key supply-chain and ingredient-solutions partner to fast food, snack-food, processed food, ready-to-eat meal and other food companies in India and abroad. Its clients include McDonald’s, Pizza Hut, KFC and Domino’s in India. [...]

Capital Partners to pick up stake in Acme Telepower

Private equity (PE) fund Capital Partners and a prominent Delhi-based industrialist are planning to pick up 5-7% stake in Acme Telepower. The deal size is estimated to be around Rs 600-800 crore, pegging the valuation of the company at around Rs 11,200 crore ($2.8 billion). When contacted, the company management refused to comment on the development. It is also learnt that Acme Telepower is planning an IPO in the immediate future. The company is set to submit its Draft Red Herring prospectus with the markets regulator Sebi, sources said. The Delhi-based industrialist who is interested in Acme runs companies associated with chemicals and pharmaceuticals, sources added. Acme Telepower’s revenues have grown from Rs 30 lakh in 2003 to over Rs 200 crore in 2005-06 and Rs 650 crore in 2006-07. As per industry estimates, Acme is on track to post revenues of Rs 1,200 crore in 2007-08. Acme is in talks to buy a Ghana-based telecom shelter company and had recently acquired a Czech-based fuel-cell company for about $50 million, sources added. [...]

ICICI arm plans Jaypee stake buy

ICICI Venture Funds Management Co. Ltd, the private equity arm of ICICI Bank Ltd, India’s second biggest lender, is planning to invest about $800 million (Rs3,148 crore) to pick up a stake in Jaypee Infratech Ltd, a unit of the cement-to-construction conglomerate Jaypee Group, said a person familiar with the matter. Mint couldn’t ascertain the size of the proposed stake. Jaiprakash Associates and ICICI Venture declined to comment. Jaypee Infratech is a fully-owned unit of the Jaypee Group and was floated to implement the Taj Expressway project, a 165km highway connecting the cities of Noida and Agra in Uttar Pradesh along the banks of the Yamuna river. The company has also got the right to develop 25 million sq. m of land along the expressway, according to annual report of group company Jaiprakash Associates Ltd, which won the rights to build the road. The rights will be transferred to Jaypee Infra-tech, the report said. [...]

Plethico Pharma to acquire Natrol

Plethico Pharmaceuticals Ltd said on Monday that on November 18, 2007 it has agreed to acquire Natrol, Inc., a leading manufacturer and marketer of nationally branded nutritional products in the USA. Under the terms of the effective merger agreement, all outstanding Natrol shares will be acquired for a cash purchase price of US$4.40 per share, for an expected aggregate purchase price of approximately $80.7mn. The acquisition will be effected by an initial general tender offer by a wholly owned subsidiary of Plethico for all of the outstanding shares of Natrol's common stock, at $4.40 net per share in cash, followed by a second-step, cash-out merger in which all remaining untendered Natrol shares will be acquired at the same net cash price per share. All Natrol stock options will receive cash equal to the excess, if any, of $4.40 over their exercise price. The tender offer is subject to certain conditions, including the valid tender in the offer of a majority of the fully diluted Natrol common stock, and other customary conditions. Certain stockholders of Natrol, owning in the aggregate approximately 42.3% of Natrol's outstanding common stock, have committed to tender their shares in the offer. [...]

PEs queue up to check into hospitality sector

After infrastructure and real estate, private equity (PE) funds are stepping up investments in the booming hospitality sector. Biggies such as Lehman Brothers and Kotak Mahindra Realty Fund have kicked off negotiations with several players in the hospitality industry. Besides the metros, investments could pour into tier II cities — Hyderabad, Ahmedabad and Pune — as well. US-based Sun Apollo Ventures LLC is set to follow suit while Blackstone is open to funding this segment in due course. Kotak Mahindra Realty Fund has already made a couple of investments in hospitality projects. “We are bullish on the business and budget hotel segment in India. Our company has invested in two projects and are considering many more in the sector”, said Kotak Realty Fund CEO Mr Sriniwasan. Kotak Mahindra Realty Fund invested Rs 32 crore in Lemon Tree, a budget hotel chain. This was followed by a Rs 45 crore investment in the Pride groups, adds Sriniwasan. The company is also keen on investing in tier II cities. “The return on investment could be quite high in these cities, thanks to the large professional and student population”, he said. NYSE-listed Lehman Brothers had invested around $ 100 million in the Kishore Biyani-promoted Future Capital Holdings to fund hotel projects in India. [...]

Singapore, Gulf funds eye 5% in Reliance Power

Sovereign government funds of Singapore, Dubai and Abu Dhabi are in race to buy 5% stake in Reliance Power in a private placement ahead of its proposed IPO. The US private equity firm Blackstone is also in talks with the company and the stake is being valued at around $1 billion. The Anil Ambani-promoted company is planning to raise up to $2.8 billion by tapping the capital markets by the year-end, making it the biggest IPO in Indian history. The company will dilute a little over 10% stake to the public and this pre-placement exercise is being done to put a valuation benchmark for the IPO, which is awaiting Sebi’s clearance. According to i-banking sources, the expression of interest from various players gives Reliance Power a valuation of over $20 billion. The company may dilute any thing between 2.5% and 5% stake to raise around $500 million to $1 billion. The stakes will be diluted to three categories of investors — the sovereign, PE and financial institutions. [...]

SAIF Partners may invest Rs 100 cr in Anupam Group

Asian Private equity player SAIF Partners is looking to invest Rs 75-100 crore in Gujarat-based crane manufacturer Anupam Group of Industries. This will be the first round of private funding for the company. E-mails sent to both Anupam Industries and SAIF Partners did not elicit a response. However, sources close to the development say the deal is almost signed. The amount of stake that Anupam Industries will dilute is not yet known. Anupam Industries is one of the largest manufacturers of cranes including power cranes, grabbing cranes, steel plant cranes, construction industry cranes, refinery cranes and nuclear industry cranes in India. The company caters to several companies including Tata Steel, Essar, Jindal, NTPC, Bhel and the Aditya Birla Group. The private placement is expected to fund the company’s expansion plans. SAIF Partners, which manages two funds with a combined corpus of $1 billion, has bought a 5% stake in NSE for over Rs 500 crore. The New York Stock Exchange, Goldman Sachs and General Atlantic have also bought stake in the exchange along with SAIF Partners. The fund has also bought stake in Chennai-based pulse processing company Asian Dhall Industries. [...]