March 2008
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Yes Bank to raise Rs 1,100 cr through debt, equity issues

Yes Bank has announced that it would be raising up to Rs 1,100 crore in 2008-09, through a combination of debt and equity routes. While the bank would look at raising anywhere between $150-170 million through a qualified institutional or private placement between April and June. The balance amount would be raised through multiple tranches in the debt market later by September. YES Bank has already entered into talks with banks and private equity players to effect this fund-raising. Under the equity issue, the bank will be issuing 20 million fresh shares to the new investors, diluting the promoters’ stake further by 6.3%. Speaking to mediapersons on the sidelines of a press conference, YES Bank managing director and CEO, Rana Kapoor said, “Global Orients, a Singapore-based financial institution led by Richard Chandler picked up a 4.99% stake in the bank in December, for Rs 331 crore. We are now in talks with investment arms of two multinational banks, one which already has presence in India. We are also in discussions with few private equity arms and are looking at a strategic investor, not a strategic partner.” Mr Kapoor added that the funds raised would be used for setting up new branches, as the bank is targeting to have 250 branches in place by 2010. It would also help the bank raise the exposure limits both for single and group borrowers, he added. [...]

E*Trade to sell its 44 per cent stake in IL&FS Investmart

Rel Cap, Aditya Birla in race to buy 44% stake from E*Trade. Anil Ambani-promoted Reliance Capital, the Aditya Birla group, Religare Securities, Indiabulls and private equity investors ICICI Ventures and Barings India Private Equity are in the race to acquire a significant stake in Mumbai-based IL&FS Investsmart. The development comes after E*Trade, the US-based discount broking firm, which holds a 44 per cent stake in the Indian brokerage house, has decided to sell its holding following heavy losses in the sub-prime credit turmoil in the United States. IL&FS Investsmart, a listed entity, currently has a market capitalisation of Rs 1,200 crore. Sources said that apart from private equity investors all others are keen on entering as strategic partners. They are evaluating this option to expand their presence in the booming broking segment in India. [...]

Private equity firms eye IPL franchises

The stock markets are in a tailspin and private equity (PE) players have found the value of their portfolios declining. Good enough reason for them to latch on to the bull run in cricket — all thanks to the flames stoked by the emergence of the Indian Premier League (IPL). It seems franchisee owners are locked in talks with these players to offload a part of their stakes in their respective teams. Investment banking sources say, many team owners are in the market to raise funds. “We are given to understand that minority stakes will be diluted by the owners. Names of franchisees going around include Deccan Chronicle (Hyderabad), Vijay Mallya (Bangalore), Ness Wadia and Preity Zinta (Mohali) and Shah Rukh Khan's Red Chillies Entertainment (Kolkata),” an investment banker, who did not wish to be named, said. Chennai Super Kings, the team owned by India Cements (ICL), has been approached by private equity investors. Admitted N Srinivasan, vice chairman and MD, India Cements: “A few private equity investors met me. They were interested in knowing if I would be willing to dilute my stake in the team's equity. I have told them that we are not in favour of diluting to anybody for the moment.” [...]

Goyal to dilute 5% Jet equity

Jet Airways promoter, Mr Naresh Goyal, would offload five per cent of his equity in the airlines before the end of this month to a private equity player, a top company official said. “Mr Goyal is targeting to dilute five per cent before the end of this month,” Jet Airways senior general manager Mr KG Vishwanath said. “We are talking to five to six private equity players. They include both national and international players,” he said. Mr Naresh Goyal holds 80 per cent in Jet through Tail Winds. According to Sebi guidelines, his stake needs to be bought down to 75 per cent. Once the dilution of five per cent stake takes place, Jet would go ahead with its $400 million rights issue. (The Statesman) [...]

IIM-A alumni’s EI gets venture funding

A group of institutional investorsand a start-up firm run by country's top B-school IIM-A alumni, Educational Initiatives Pvt Ltd (EI), have entered into a strategic tie-up for a project on school education and assessment. A consortium of investors including Footprint Ventures, Novak Biddle Venture Partners, the ICICI Bank-supported IFMR Trust and industrialist Gautam Thapar have joined hands with EI to fund the latter's project. EI's ASSET test, which is expected to be taken by hundreds of thousands of students in India this year, is the company's core initiative. EI executes large scale assessment and research projects with contracts from agencies such as the World Bank, UNICEF, and the Michael and Susan Dell Foundation. “In the schools, efforts to shift from rote to learning by understanding makes for a great starting point,” said EI's managing director, Sridhar Rajagopalan. [...]

M&As: A year of adventure for India Inc abroad

The year 2007 turned into a remarkable one for Indian M&A, both at home and abroad. Spending more money on overseas acquisitions than foreign companies did in their own market, Indian companies have made their presence felt globally. Domestically, 2007 saw another record year of deal activity, with total mergers and acquisitions (M&A) and private equity (PE) deals up 82 per cent from Rs 865 billion ($21 billion) in 2006 to Rs 1,576 billion ($38 billion) in 2007. As well as volume, both number (867 against 697) and average size of deals also rose significantly. International acquirers have continued to account for the bulk of domestic deals at Rs 1,189 billion ($29 billion). This is 75 per cent of the total domestic deal value as against 71 per cent in 2006. But the real story of the year is overseas, where Indians bought up companies in Europe and the US, splashing out some Rs 1,367 billion ($33 billion). [...]