July 2009
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VC exits in first half lowest since 2007

Exits by venture capital (VC) firms slumped to their worst since 2007 in the first half of this year as mismatched valuations soured deals, and an overall liquidity crunch took a toll on the buying and public issue plans of Indian companies. Between January and June, only four firms saw exits by their VC investors, compared with five exits in the first half of last year and 14 in the same period in 2007, according to a study by Venture Intelligence, a research firm focused on private equity and merger and acquisition (M&A) deals in India. […]

Anil Ambani, Kumar Birla to float PE funds

For private equity (PE) arms of big Indian corporations, fund-raising, such as charity, seems to be beginning at home. The Reliance-Anil Dhirubhai Ambani Group (R-Adag) will invest Rs400 crore in a PE fund being floated by group company Reliance Capital Ltd. This will include a contribution from R-Adag chairman Anil Ambani, a senior official of the group said. Similarly, Aditya Birla Group chairman Kumar Mangalam Birla will invest around Rs300 crore in the group’s PE fund. The R-Adag PE fund may raise Rs2,000 crore while the Aditya Birla Group’s PE fund will have a corpus of about Rs1,500 crore. […]

State Bank of India, LIC invest in Reliance Private Equity

Large Indian banks and financial institutions such as State Bank of India (SBI), Life Insurance Corporation (LIC), General Insurance Corporation (GIC), Bank of Baroda (BoB) and IDBI Bank have helped Reliance Equity Advisors, which is of the Anil Dhirubhai Ambani Group, mop up around Rs 1,500 crore. While this has been tied up in less than three months, the company is expecting to raise another Rs 500 crore over the next two weeks, Reliance Equity Advisors Chief Executive Officer Ramesh Venkat told Business Standard in an interview. He, however, did not disclose the investors. Although the company has not announced a closure date, Venkat is confident of achieving the target. […]

BSNL may pick up 15% stake in Essar's Kenya venture

State-owned telecom service provider BSNL plans to pick up a 10-15% stake in Essar Group’s Kenyan subsidiary as it looks to gain a foothold in Africa, one of the fastest-growing telecom markets in the world. The Essar Group, with interests in telecom, shipping, steel, power and oil, holds 80% in Essar Telecom Kenya, while the remaining 20% is held by local shareholders. A BSNL official confirmed that talks are on between the two companies. “Valuations are being discussed. We are doing the due diligence,” the official told ET NOW, requesting anonymity. The Essar Group declined to comment on the development. […]

Private equity, venture capital deals start gathering pace

Private equity (PE) and venture capital (VC) deals in India are seeing an uptrend again. Though the first half of 2009 was dismal overall, the number of such deals and the amount of investment therein has risen in the past couple of months. And if market sources are to be believed, the numbers will only get better going forward. Vikram Utamsingh, head of private equity advisory group at KPMG, believes some funds that were busy adding value to their portfolio companies after the global meltdown are now looking at fresh investments. […]

Abbott to buy India nutritionals for $130 mln

Abbott Laboratories Inc said it plans to widen its array of nutritional brands in India by paying $130 million for the nutrition businesses of Wockhardt Ltd, certain Wockhardt subsidiaries, and Carol Info Services Ltd. The suburban Chicago healthcare company said the cash deal for the businesses, which have 600 employees, is expected to close in the second half of 2009 and is not expected to affect its full-year profit forecast. Abbott, which has operated in India for a century and has 1,500 employees there, already sells a number of nutritional products in the world's second-most-populous country. They include Abbott's infant formula Isomil, PediaSure for children ages 1 to 13, adult nutrition brand Ensure, and Glucerna nutrition products for diabetics. […]

Ess Dee Aluminium may buy Italian co

Ess Dee Aluminium, a leading provider of packaging solutions, is in advanced talks to buy Comital, an Italian firm almost five times its size, for $125-150 million. A deal will help Ess Dee Aluminium expand its presence in the consumer packaging business and ramp up global operations. “We have been looking overseas for acquisition opportunities. But I have no comments to make on any specific transaction,” said Sudip Dutta, CMD of Ess Dee Aluminium. Mr Dutta owns close to 60% of the publicly listed firm, which provides packaging solutions for drugmakers and food industry. Comital is majority owned by Milan stock exchange-listed investment group Management & Capitali. Comital group had revenues of $403 million for the year ended December 2008. Bank of America Merrill Lynch is the banker facilitating the transaction. […]

HealthCare Global scouting for Rs 50 cr PE fund

The Bangalore-based Healthcare Global (HCG) is gearing up for its overseas debut even while negotiating with a few private equity players to close its fourth round of funding. The oncology major is in advanced talks with PEs including a US-based one, to raise Rs 50 crore. So far, the Rs 110-crore specialised healthcare operator has raised about Rs 50 crore from IDFC Private Equity, Evolence India Life Sciences Fund and PremjiInvest. This time around, India Venture Advisors, the Piramal-group healthcare focused private equity fund is also in the fray. Having made considerable headway in its talks with HCG, it is ready to infuse Rs 60 crore. However, further details on the deal are not available. […]

Race to acquire Maytas Infra is heating up, CLSA mopped 7%

NDTV Profit was the first to report this last week and now in the latest development, troubled infrastructure firm Maytas, which has asked to be sold, may find no dearth of bidders. Maytas was pushed into the limelight after its founders ended up in the dock for cooking up India' biggest fraud at sister firm Satyam. The race to acquire Maytas Infra is heating up and is likely to be as closely watched as the race for Satyam. Big infrastructure companies have jumped onto the bandwagon, and are all vying for a piece of the Maytas Infra pie.Even as buzz about the beleaguered Maytas Infra scouting for strategic partners grows louder, Hong Kong-headquartered brokerage and investment group CLSA has picked up a total 6.86% equity in the company. CLSA is learnt to have mopped up the entire equity through open market transactions in the month of July through its Mauritius arm CLSA (Mauritius) Limited. […]

IFIF to infuse capital into Sonata Finance

India Financial Inclusion Fund (“IFIF”) has affirmed its commitment to infuse capital into one of the microfinance industry’s pioneering bellwethers, Sonata Finance Private Limited (“Sonata”) in the near future. IFIF, set up in August 2008 and advised in India by Caspian Advisors Private Limited (“Caspian”), focuses on making equity investments into microfinance institutions and microfinance enablers in the country that are directly or indirectly associated with bringing about the financial inclusion of the poor and thus further developing a microfinance ecosystem. A microfinance institution (MFI) that commenced operations in January of 2006 in the eastern part of the Uttar Pradesh state in India, Sonata has in just three years, reached out to nearly 85,000 women clients, in more than 15 districts with a portfolio outstanding of over Rs. 42 crores in loans to the poor. […]