September 2008
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Tata AIG solvency questioned

Indian insurance regulator IRDA has reportedly asked Tata AIG to clarify its solvency. A tight-lipped AIG (India) confirmed that its solvency had been questioned, but refused to answer additional questions. “Having regard to the developments reported in USA, the IRDA has asked for the reports of the companies in the matter,” a spokesperson said. According to IRDA, the US economic downturn and recent collapse of several banks has caused serious concern in Indian financial markets.AIG India shares are currently split between Tata and AIG, with the former holding 74 per cent and the latter retaining the remaining 26 per cent.Nevertheless, Indian policy holders will be relieved to learn that the Federal Reserve Board has agreed to lend as much as $85 billion to rescue the floundering American International Group. […]

NMDC to buy SIIL for Rs 800 cr

National Minerals Development Corporation (NMDC), India's largest iron ore producer and exporter, will acquire the Hyderabad-based Sponge Iron India (SIIL) for a maximum of Rs 800 crore. The acquisition proposal is yet to be approved by SIIL. NMDC has formed a draft proposal to merge with SIIL by acquiring the Hyderabad company's shares. It will also have to pay Rs 80 crore to the Government of India as purchase consideration and buy Andhra Pradesh Government's 1.23% stake in SIIL. […]

M&A, PE deals cross $5.57-b mark in Aug

After a quiet July, dealstreet was again buzzing with action in August. The total value of mergers and acquisitions(M&A) and private equity(PE) deals during the month is pegged at more than $5.57 billion against a mere $1.23 billion in July’08. Though this has largely to do with large M&A transactions, even PE deal value jumped almost 50%. While the number of M&A transactions actually dropped compared to July, the total value of deals rose sharply month-on-month. The total number of M&A deals announced during August stood at 31 with an announced value of $4.63 billion against 43 deals amounting to $580 million during July 2008, according to the latest dealtracker of advisory firm Grant Thornton. […]

Singapore fund picks up 10% in Excelsoft

Arohi Asset Management, a Singapore based fund, is understood to have recently picked up 10 per cent stake in Mysore-based e-learning firm Excelsoft. Arohi is understood to have valued this Rs 60 crore firm at Rs 400 crore. This move by Arohi comes close on the heels of D E Shaw, a global private equity player picking up 35 per cent from UTI Ventures for $31 million, valuing the firm at Rs 350 crore. The management of Excelsoft were not available for comment. Post this move by Arohi, the promoters of Excelsoft currently hold 55 per cent. While details of Arohi is not clear, sources indicate that this firm manages a corpus of around $300 million. Excelsoft provides a range of customised learner-centric systems, test and assessment systems and desktop tools. […]

Blackstone, Actis among PEs in race for 40% in Usher Agro

Leading private equity (PE) firms such as Blackstone, TPG, Blue River Capital, Actis and Silk Route are eyeing more than a 40% stake in agri-processing firm Usher Agro, it is learnt. The deal, if concluded, will pave the way for the PE investor to acquire management control with a majority stake. In that case, it will be third instance where a PE investor is taking control of a listed company in the recent past. Broad contours of the plan suggest that Usher will raise funds by issuing new shares to the PE investor. It will also sell shares of its four subsidiaries in the power, logistics, credit finance and oil and food segments. The promoters and some existing investors plan to sell some portions of their equity to encash their holding. […]

IndusInd plans to float $1 bn India-specific fund

Hindujas-promoted IndusInd Bank has said it is looking to float a one bn dollar fund (about Rs 4,500 crore) for investments in India. “We are going to partner with Indian firms that are known in the capital market space and are in the process of floating funds of their own. It is going to be the Hinduja brand name alongside local firms,” promoter of the bank and Group Chairman S P Hinduja revealed here. “One of the things we are planning to do in Dubai is to offer an offshore fund for investment into India,” he said after the 15th Annual General Meeting of the IndusInd International Holdings Ltd (Mauritius). […]

R-Cap to raise $1 bn for PE foray

Reliance Capital (R-Cap), an Anil Dhirubhai Ambani Group firm, is raising $1 billion (over Rs 4,600 crore) from foreign investors for its foray into the private equity business. The fund will invest in the Indian equity market after concluding the capital raising plan by December 2008, Sam Ghosh, chief executive officer, R-Cap, told Business Standard. “We have received necessary approvals for our private equity business. Now, we are in the process of raising funds. This fund will be used for all types of equity investments in the country,” Ghosh said. R-Cap recently forayed into institutional broking and asset reconstruction. According to Ghosh, these businesses received an overwhelming response from the market. […]

BTS Investment to launch $200m fund

With over 60% of its second fund exhausted, Mumbai-based BTS Investment Advisors is gearing up to launch a third fund, titled BTS Fund II, by mid-2009. K Srinivas, managing partner, BTS Investment Advisors, said while the first and second funds were in the region of $22 million and $80 million respectively, the third fund is expected to be around $200 million. “As deal sizes increase from $1.2-3 million in 1997 to $7-8 million in 2005 and $12-15 million now, we are struggling to meet the funding requirements and have to bring in co-investors to serve the purpose,” he said. The third fund will also focus on SME group. “We would like to stay with it and maintain our dominance in that segment,” said Srinivas. […]

Wipro, Copal to bid for Lehman BPO

As Lehman Brothers Holdings, a U.S based investment banking firm has decided to file for bankruptcy protection in the US., India's third largest IT company Wipro and Copal Partners, a knowledge process outsourcing firm have expressed interest to acquire its back office business in India, reported Business Standard. Lehman currently owes over $600 billion to lenders. In this regard, the bank's offshore development center, which houses over 100 employees at Wipro is expected to close down. Sources said that Mumbai office also is expected to be shut down shortly. […]

3i team eyes Adani Power stake

A consortium of investors, led by private equity player 3i, is in talks to pick up a 4-4.5% equity stake in Adani Power for Rs 1,800 crore. The power company, which is majority-owned by Adani Enterprise, is in the process of floating an initial public offer (IPO) and the stake sale is a precursor to the public issue. The pre-IPO transaction will value Adani Power at nearly $10 billion, making it the most valued private sector power company in the country. The consortium of investors includes Singapore’s Temasek and an infrastructure fund, according to sources. The Adani Group spokesperson declined to comment on the matter. […]