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Private equity firms, which were once hot on Indian real estate, have of late turned wary of investing in realty companies whose shares have been hit by a worldwide slide in stock prices. Placement deals worth between Rs 15,000 crore and Rs 20,000 crore by Indian realty firms have been put on the hold, according to investment bankers tracking the matter. “Although investors are willing to renegotiate prices, the companies cannot make any placement because regulations do not permit them,” said Yogesh Kapur, vice-president at Enam Financial. The Securities and Exchange Board of India prohibits listed companies from making private placements at prices below the average for six weeks or six months, whichever is higher. […]
Most PE or VC firms, which arrived in India in past 12 months, are perhaps finding the going a little tough. There seem to be quite a few firms which have done no deals yet, or at best one or two deals in say 12 months of being active in India. In other words, many of these firms are as yet finding their way around in the Indian markets. A look at the data would also give some indication. In the first quarter of 2008 (Jan-Mar), private equity firms invested about $3.3 billion in 97 deals according to Venture Intelligence. In Jan-Mar 2007, there were 101 deals. So while the number of PE firms is perhaps up 15-20% in the same period, the number of deals going around is roughly the same. The learning here is simple — traditional PE models which apply in say, US or Europe, may not always work in India. For example, it is hard to do large deals in India, for more than one reasons — supply remains low, consequently valuations are often an issue. Deals like buyouts are still harder. […]
J K Tyre has acquired Mexican tyre company, Tornel for Rs 270 crore to become India's fourth largest four-wheeler tyre company. JK Tyres' turnover will now exceed USD 1 billion. The company will fund the acquisition through a mix of internal accruals and debt. This buyout is expected to be completed by the end of May, subject to regulatory approvals. The acquisition makes a strategic fit for JK Tyres as it is already the largest exporter, exporting almost 48% to the North and South American Markets. Mexico-based Tornel offers free access to the NAFTA trade block and Central and Southern America. Therefore, together both the companies would considerably strengthen the market positioning in these territories. […]
Breaking from the tradition, the $5 billion TVS Group has, for the first time, let a private equity investor Goldman Sachs invest nearly Rs. 100 crore and pick up an undisclosed minority stake in the Rs. 338-crore turnover TVS Logistics Services Ltd., setting the stage for an eventual IPO (initial public offer). TVS Logistics is hoping to use the money, reach and contact of Goldman Sachs to further speed up its growth. The company has set itself a turnover target of Rs. 1,000 crore to be hit by 2010. Addressing a press conference here on Friday, Suresh Krishna, Chairman, TVS Logistics, said the private equity (PE) option was forced by “market reality”. Answering a volley of questions, he said the PE money did not come through stake sale. It came via issue of additional shares at a premium, he added. The equity capital of the company stood at Rs. 12 crore prior to the induction of the PE fund. “We will go in for an IPO at an appropriate time. We will wait for the right time,” he added. R. Dinesh, Operating Director, however, said it (IPO) would not be in the next 18 months. […]
Anil Ambani-owned Reliance Big Entertainment Ltd (RBEL) on Wednesday said it acquired 100 per cent stake in the digital images business of the US-based DTS Inc, marking its first overseas acquisition in the digital-services space. DTS Digital Images (DDI), popularly known as Lowry Digital Images, is engaged in independent restoration operation in Hollywood, providing picture quality improvement services to movies, television and video content. It is considered to be a market leader in the field of digital restoration and enhancement of moving pictures, using proprietary tools and algorithms it has developed over the years. DDI works with Walt Disney, Paramount Pictures, MGM and 20th Century Fox and entertainment leaders like George Lucas and James Cameron. It has restored more than 300 of the world’s most recognised feature films with output to DVD, HiDef, 35mm film, Digital Cinema, and IMAX. Its body of work includes Casablanca, Singing in the Rain, Sunset Boulevard, Indiana Jones trilogy, Star Wars trilogy, James Bond films and numerous Disney classics such as Cinderella, Bambi, 101 Dalmatians and Lady and the Tramp. […]
John Keells Holdings (JKH), the largest public conglomerate in Sri Lanka, has picked up 44% stake in Quatrro F&A. Quatrro, along with John Keells, has acquired US-based RSM McGladrey’s financial process outsourcing (FPO) unit. Quatrro F&A is the new entity formed after the merger of Quatrro’s finance & accounting unit with the newly-acquired FPO. As part of the deal, John Keells will shell out $5.72 million upfront and will bring in additional funds over a period of time for the FPO acquisition. “We have carved out a new legal entity from the merger of our own finance and accounting practice and RSM’s FPO unit. John Keells has picked up 44% stake in this new entity,” said Quatrro CMD Raman Roy. The acquisition of the FPO unit would be financed through a mix of debt and equity. […]
Real estate and textile firm Modern India Ltd said it is in talks with private equity players to dilute the founders' holding and also sell stake in its special economic zone unit, its top official said. “We are in talks with 2-3 players, and we will finalise in the next one to one and a half months”, Chairman and Managing Director V K Jatia told Reuters on Friday. The firm's monthly rental will more than double to 20 million rupees after June, from between 7.5 million and 8 million rupees a year ago, due to an increase in rental income, Jatia added.(Reuters) […]
In a bid to unlock value at one of the world’s largest gas finds in the Krishna-Godavari basin, Reliance Industries Ltd (RIL) is believed to be planning to divest up to 10% stake in its K-G D6 block to a strategic foreign partner. A 10% stake in the block, valued at Rs 59,800 crore according to Deutsche Bank, will fetch RIL a neat sum, which could be further pumped into exploration and production (E&P). RIL holds 90% in the K-G D6 block and Nikko Resources, the rest. Agencies reported on Thursday that RIL has initiated talks with a host of big global energy E&P players as potential partners. Hydrocarbon giants with the required expertise include the likes of ExxonMobil, Shell, BP, Total and Petrobras. However, the move could not be independently confirmed, as Reliance officials remained tight-lipped about it. An RIL spokesperson declined to comment. […]
Atlas Copco India Ltd (ACI), the Indian subsidiary of Swiss industrial productivity equipment manufacturer Atlas Copco AB, has acquired a 25% holding in two Hyderabad-based drilling technology companies—Focus Rocbit Pvt. Ltd and Prisma Roctools Pvt Ltd—for an undisclosed amount. While Focus Rocbit is a manufacturer of bits for rotary drilling, Prisma Roctools makes bits and hammers for down-the-hole drilling, said Mike Mustapha, managing director of Atlas Capco India. Atlas Capco has the option to acquire the balance 75% holding in these two companies, which currently have a combined turnover of $10 million (Rs40 crore), within a year. Atlas Capco has acquired four companies in the Indian market in the last five years. It did not disclose the financial terms for those deals as well. […]
Financial Technologies India acquired 90% stake in ICX Platform (Pty), a technology company situated at Johannesburg, South Africa, having IPR & corporate ownership of electronic warehouse receipts technology, at a cost of upto USD 1.50 million, subject to applicable approvals and fulfillment of certain representations and warranties by the sellers of ICX. Financial Technologies (India) is a flagship company of Financial Technologies Group. Financial Technologies is India`s leading vertical specialist enterprise delivering mission-critical, straight through processing (STP) solutions comprising domain expertise, technology licensing, development and transaction outsourcing services. […]
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