November 2007
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PE deals double in H2, valued at $13.62 billion

Notwithstanding the sub-prime crisis in the US, private equity deals have grown faster in the second half of the calendar year with global biggies Goldman Sachs sealing five deals, followed by Merrill Lynch and Morgan Stanley with three each in September and October this year. According to Grant Thornton’s dealtracker, 207 PE deals valued at $7.46 billion were announced during the first six months of 2007. The total deal value has nearly doubled in the last four months, with the number of PE deals increasing to 336, valued at $13.62 billion, during the first 10 months of the year. “Large funds who want to make significant investments in India are coming here. The sub-prime crisis in the US has impacted the share price of the big Wall Street firms but has not led to diminished interest from them in the India growth story,” said C G Srividya, partner, corporate advisory services, Grant Thornton India. […]

JC Flowers buys 36% in Sicom for Rs 350 crore

New York-based JC Flowers, one of the world’s largest private equity firm focused solely on the financial services sector, has picked up 36 per cent stake in the State Industrial Corporation of Maharashtra (Sicom), the investment arm of the Maharashtra government, for close to Rs 350 crore. The deal values Sicom at Rs 972 crore. Sources said JC Flowers won the bid for the stake, which was put up for sale early this year by the Specified Undertaking of Unit Trust of India (SUUTI or UTI-1). SUUTI had invited bids from financial and strategic investors for selling its stake in Sicom. The other two contenders for the stake were L&T Infrastructure and another US-based private fund. Sources said for JC Flowers this was a good investment as Sicom, as an NBFC (non-banking financial company) had the rights to confiscate assets in case of defaults. […]

Essel Sports to raise Rs 200 crore, divest 25 percent to PE funds

Subhash Chandra's Essel Sports is looking at raising up to Rs 200 crore by divesting 25 per cent to private equity companies to finance its troubled Indian Cricket League (ICL) and other domestic cricket projects. Confirming this, Asish Kaul, executive vice-president of Zee Entertainment Enterprise Ltd and Essel Group spokesperson, said: “Several companies have come forward to associate themselves with Essel Sports. Indian and foreign institutional investors have also shown interest in being equity partners.” He added that no decision has been taken yet since “the company’s focus has been to get ICL off the ground”. The move comes at a time when the high-profile ICL is to begin from December 1 in Chandigarh with six teams playing against each other. […]

Indiareit to Invest in Luxury Housing Project Outside Mumbai

Indiareit Fund Advisors, the venture capital firm controlled by the Piramal Group, plans to invest in a housing project along Mumbai's eastern coast, seeking to overcome a land shortage and rising prices in the city center. Mumbai-based Indiareit will invest 1.5 billion rupees ($38 million) in Samira Habitats, a company that's developing luxury villas and apartments in Alibag, on the mainland across from the Mumbai island, Managing Director Ramesh Jogani said in an interview yesterday. “It will be a way out of Mumbai's congested infrastructure,'' Jogani said. “The projects will make Alibag a base of primary homes, instead of holiday and weekend homes as in the past.'' Residential prices in south Mumbai have more than doubled in the past three years, as India's booming economy bolstered the spending power of local residents and prompted overseas companies to bring in workers. Mumbai also has the second- priciest offices in the world after London, according to CB Richard Ellis Group Inc.'s semi-annual Global Market Rents survey. […]

PE, hedge funds bought 10% stake in Argentum

Leading private equity and hedge funds D E Shaw, Rand Corporation of South Africa-promoted proprietary fund Satwa based in Hong Kong and Infrastructure Leasing and Financial Services Ltd (IL&FS) have collectively bought 10 per cent in Argentum Motors. Argentum Motors is a company floated by B V R Subbu, former president of Hyundai Motors India, Ajay Singh, promoter of budget airline Spicejet, and Ashish Deora, who runs a broadband company. The company took over the Daewoo Motors India factory near Delhi, which shut shop four years ago, for Rs 800 crore and is planning to set up one of the country’s largest auto ancillary units and function as a third-party manufacturer for auto companies. The three funds have collectively forked out Rs 200 crore for the 10 per cent stake and have also provided the company a loan worth Rs 100 crore. […]

Global players line up $25 b for Indian realty pie

Global real estate majors such as Dubai World, Trump Organisation of US, Smart City of Dubai, Kishimoto Gordon Dalaya, Khuyool Investments, Bonyan Holding, Plus Properties, ABG Group and Al Fara’s Properties are descending on the Indian real estate market with an investment of around $20-25 billion in the next 12-18 months. Top-level management teams of around 50 global developers are currently in India scouting for joint venture partners and tie-ups with various state governments to enter one of the booming property market in the world. Officials close to the developments said that over 200 meetings were held between the representatives of foreign real estate firms and Indian companies and over a dozen JVs are in the final stages. DAMAC Holding (a Dubai-based leading real estate firm ) chairman and founder Hussain Sajwani said they have firmed up plans to invest around $3-5 billion in the Indian market. “We are in negotiations with various Indian developers for a possible joint venture, and hope to enter the market in the next 12 months,” he said. […]