October 2009
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Glaxo looking at 5% stake in Dr Reddy’s

Western drug makers are stepping up the hunt for emerging market “tigers” in India. UK-based GlaxoSmithKline Plc has emerged as frontrunner for a phased buy-in of Dr Reddy’s Laboratories Ltd, people familiar with the matter said. A deal could spark a fresh wave of foreign deals in India’s drugs sector after the troubled purchase of Ranbaxy Laboratories Ltd by Daiichi Sankyo Co. Ltd last year. While nothing is finalized, one possibility is that Glaxo will take a 20% stake in Dr Reddy’s Holdings, a family vehicle that in turn owns 23.2% of the drug maker. This would give Glaxo a stake of just under 5%, worth around $165 million (around Rs764 crore). But the British firm could also get right of first refusal on the family’s remaining holding, the sources said. Officials at both firms declined to comment. [...]

Family firms a big hurdle for Indian PE buyouts

Global buyout giants such as Warburg Pincus and the Carlyle Group may have to wait a decade or more for Indian family business cultures to change before they can make big buyout deals, finance industry executives said. Meanwhile, growth capital funds have seen better opportunities in India finding bargains by taking stakes in new, fast-growing sectors such as education, healthcare, logistics and consumer-driven business, a private equity conference was told on Wednesday. “Private equity deals in India are mostly growth-led rather than leveraged buyout, as in the West,” said Deepak Parekh, chairman of Housing Development Finance Corp, India's top mortgage lender. [...]

Ansal in talks with PE cos to raise $100 mn

Ansal Properties and Infrastructure (API) is in talks with at least two private equity (PE) players, including Red Fort India Real Estate Fund and Bahrain-based Investate Realty, to raise up to $100 million through equity stake sale in its two projects, according to two people close to the development. A spokesperson of the Delhi-based company said that API was looking for PE investments in its projects, but declined to comment on whether it was in talks with Red Fort and Investate Realty. Red Fort declined to comment, while Investate didn’t respond to an email query. According to people close to the situation, the two PE players are separately in negotiations with Ansal to buy at least 26% in the two proposed townships in Lucknow and Dadri near Delhi. [...]

IDFC and India Infrastructure Fund take 20 per cent stake in INR45.4bn energy project

The Infrastructure Development Finance Company (IDFC) and the IDFC Project Equity Company, which manages the India Infrastructure Fund (IIF), have taken a 20 per cent equity stake in GMR Kamalanga Energy, a special purpose vehicle (SPV) set up by Indian infrastructure developer GMR Group to implement a thermal power plant. IIF is to hold 15 per cent of the SPV, while IDFC will take five per cent. The goal of the Kamalanga project is to install a 1,0505MW coal-powered thermal power plant in the Dhenkanal District, Orissa, at an estimated cost of INR45.4bn ($978.7m). The project has a dedicated coal allotment and secure fuel linkage, and already has a large portion of its output allocated to various long-term power purchase agreements, according to IDFC. [...]

Govt blocks Etisalat-Allianz merger

The government has blocked the proposed merger between Etisalat DB Telecom (earlier Swan) and Allianz Infratech citing the three-year lock-in requirement under the current rules. The two players, which entered the local telecom market as recently as last year, had moved the Department of Telecommunications (DoT) in April this year seeking approval for a merger. The DoT has informed the two vide a letter dated October 7, that the merger “cannot be permitted before the lock-in period of three years”. [...]

Indiareit launched a close- ended domestic venture captial fund

Indiareit Fund, a real estate captial fund promoted by Piramal Enterprises, today launched a close- ended domestic venture captial fund scheme focused on investing in Indian real estate market. “The investment objective of the fund is to make investments in projects within the gambit of real estate focusing on long-term capital appreciation,” Indareit CEO and MD Ramesh Jogani told reporters here. He said the fund would participate by means of equity instruments of unlisted companies (special purpose vehicles for specific projects identified by the fund for investment) engaged in real estate. [...]