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The uncertain future of the equity market seems to be paving the way for newer invesment opportunities. Private equity (PE) players have been quick to recognise these. Of late, their appetite seems to have shifted from the most-talked about sectors like real estate and financial services, which were the flavour of the season till some time ago, to sectors like education, healthcare, defence, logistics, warehousing and infrastructure. These not-so-talked-about sectors are now attracting big private equity players. Though some of these are the very basic sectors of the economy, it is only recently that investment interest has found a place in them. […]
Private equity firms had raised piles of capital when the going was good, but thanks to the global credit crisis, many of these firms are finding an increasing number of investors who aren’t honouring their capital commitments. While raising capital, private equity funds get commitments from investors such as pension funds, university endowments, hedge funds, fund of funds and high net-worth individuals. These commitments are drawn down as and when the fund makes an investment. This means that till the capital is deployed, its control rests with the investors, collectively referred to as limited partners (LPs). Because of the huge erosion in the market value of their fixed income and equity exposure, many of these LPs, especially the pension funds and endowments, could suddenly find themselves overexposed to private equity, an asset class that is not marked to market. If they decide to reallocate assets, private equity funds may find themselves in a situation they last faced during the dotcom bust, when many LPs pulled out and funds were left with little capital to “draw down”. Another problem could arise from hedge funds or institutions who have been taken over by larger institutions. […]
Israeli holding company Koor Industries on Sunday denied it was in talks to sell a large stake of generic agrochemicals maker MA Industries for more than $1 billion. On Saturday, India's Business Standard newspaper reported that United Phosphorus Ltd (UPL), India's largest pesticide maker, was in talks to buy about 39 percent of MA for some $1.1 billion from Koor, which owns 40 percent of MA. The report sent shares of MA up more than 9 percent by early afternoon trading in Tel Aviv. “We are denying it. It is not true at all,” said a Koor spokeswoman in Tel Aviv, without elaborating further. […]
Helion Ventures and TVS Shriram Growth Fund have invested $7.5 million in 9.9 Mediaworx Pvt Ltd, a diversified media company focused on niche consumer, business and professional communities. Sanjeev Aggarwal, MD of Helion, and Gopal Srinivasan, CMD of TVS Capital, will join the 9.9 Media Board. Announcing the investment, Pramath Raj Sinha, Founder & MD of 9.9 Media, said, “We are fortunate to have such first-rate investors as Helion and TVS Shriram Growth Fund as partners in our journey to build a next-gen media company. In particular, we are excited that two seasoned entrepreneurs in Sanjeev and Gopal are joining our Board.” The funds will be utilised to fund growth and the launch of new products and services. “We are impressed with how much the 9.9 team has been able to achieve in a short period of time. At a time when media in India is expanding and growing rapidly, we see 9.9 Media as the ideal vehicle to extend our portfolio into the media space,” said Sanjeev Aggarwal, MD of Helion Ventures. […]
ic2 Capital, a private equity firm, has launched a $250 million dedicated India fund to provide growth capital to mid-cap companies. ic2 Capital, based in London and Delhi, is focused on growth capital investments of $5-$30 million in established mid-market companies in India. ic2 has identified hospitality, logistics, food, support services, media and defence as key sectors. This investment approach is underpinned by a commitment to work with management to build sustainable businesses which can operate to world class standards. ic2 Capital is in advanced stages of due diligence and execution on three proprietary investments in hospitality, logistics and food. ic2 expects to invest approximately $50 million by the end of 2008. ic2's prior investments include Bollywood media production and distribution company Eros International. […]
FMCG major Emami Ltd today acquired the entire Parikh family stake of 18.18 per cent in Zandu Pharmaceuticals for an estimated Rs243 crore. Emami also acquired an additional 37,417 shares of Zandu for about Rs5.4 crore in open market transactions, taking its total holding in the Mumbai-based company to 50 per cent. Under the deal, which ended months of hostility, Emami paid Rs15,000 per share and an additional non-compete fee of Rs1,500 per share for acquiring the 1,46,643 shares that the Parekh family held in Zandu. Emami can now offer to acquire another 20 per cent in Zandu, taking its holding further to 70 per cent. The acquisition makes Emami the largest shareholder of Zandu and the transaction effectively paves the way for Emami's acquisition of Zandu. […]
The liquidity crisis has so far not hurt venture capital (VC) investments, which are typically early stage and growth stage. The investment figures for the second quarter ending September 2008 indicate VCs invested $290 million across 49 transactions, representing a healthy 36% growth in volumes and 15% in terms of value over the corresponding quarter of the previous year. The figures for the immediately preceding quarter, ending 30 June 2008 were $ 165 million across 28 deals, according to Venture Intelligence, a firm which collates information on VC investments and exits in India. A majority of these deals in 2008 were early stage investments, while about 39% were growth stage investments, according to VI CEO Arun Natarajan. […]
Japan's DoCoMo is reportedly the front runner in a bid to buy 26 per cent of India’s sixth largest mobile operator, Tata Teleservices (TTLS). The deal, worth US$2.5 billion, would value Tata Teleservices and its 29 million subscriber base at US$9.61 billion, or roughly $331 per subscriber, according to the livemint website. Other foreign players who had previously expressed an interest in TTLS include France Telecom, UAE’s Etisalat, Mexican operator, TelCel and Russia’s Altimo. TTLS operates a pan-India CDMA network and was recently granted a pan-India GSM license by the regulator. TTLS is the smallest of the country’s major operators, behind Bharti, Reliance, Vodafone Essar, BSNL and Idea. It posted a fiscal year loss of US$1.87 billion for the period ended March 2008, including US$1.5 billion in losses carried forward from 2007. […]
Business Standard is reporting that the Cabinet Committee on Economic Affairs (CCEA) has approved Idea Cellular’s subsidiary Aditya Birla Telecom’s (ABTL’s) proposal to sell a 20% stake to P5 Asia Holdings Investments (Mauritius), a member of private equity firm Providence Equity Partners. The purchase will cost INR27.04 billion (USD545 million), and will bring the total foreign direct investment (FDI) in the company to 74%. The CCEA has also approved plans that will see Idea transfer its 16% stake in Indus Towers to ABTL; Indus is a joint venture mobile tower company with Bharti Airtel and Vodafone Essar which owns 70,000 base transceiver stations. […]
Norway-headquartered global telecom major Telenor is close to buying a substantial stake in Unitech Wireless, the telecom arm of the realty major Unitech, for about $1.5 billion. In case the deal goes through, for Unitech it would be Telenor over Telecom Italia. On the other hand, for Telenor, this deal would mean preferring Unitech Wireless over Datacom Solutions, the telecom company jointly owned by Videocon and Vinay Maloo (formerly of HFCL group) which is fast losing its early-mover advantages because of disputes between the two shareholders, sources said. […]
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