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Volatile capital markets coupled with high valuations have resulted in almost 67% of the private investments in public enterprises (PIPE) deals in 2007 ending in the red. PIPE deals are investments made by private equity funds in publicly-listed companies, usually through preferential allotments. Industry experts maintain that sustained downtrend and uncertain market conditions of 2008 have pushed the overall till-date (as on June 10) return on PIPE deals of 2007 (on volume basis) to -5.81%. “This can largely be attributed to two things,” said Jagannadham Thunuguntla, equity head of NEXGEN Capitals. “One, entry valuations were on the higher side and two, under-performance of capital markets on the backdrop of fast changing global/Indian macro factors. Also let us keep in mind the fact that the investments happened at the fag end of a bull market and we are looking at valuations at what seems to be the beginning of the bear market,” he added. In contrast, a quick review suggests that IPOs/pre-IPOs of 2007 yielded positive returns as of June 10, on volume basis. It were pre-IPO investments that showed the best returns as compared to IPO and PIPEs. […]
Pfizer Inc., the world's largest drugmaker, may make a hostile bid for Ranbaxy Laboratories Ltd., countering an agreed takeover by Daiichi Sankyo Co., the Business Standard said, citing people familiar with the matter. Pfizer, based in New York, may offer to buy the 65 percent of Ranbaxy that's not held by the founding Singh family, the paper said. Daiichi Sankyo Co. agreed on June 11 to pay as much as $4.6 billion for Ranbaxy to enter the generic-drug market where sales are growing twice as fast as branded medicines. Pfizer's India unit and Daiichi declined to comment. A battle for Ranbaxy, India's biggest drugmaker, may bolster shares of a company that have lagged behind the benchmark index for the past three years. Ranbaxy has waged a costly legal battle with Pfizer in the U.S. and Europe over the right to sell cheap copies of blockbuster drugs led by cholesterol treatment Lipitor. […]
BCCL has acquired stake in Culture Holiday (I) Pvt Ltd, a company owning TravelChaCha.com, a travel portal, which provides end-to-end travel planning services. Travelchacha.com specializes in offering single-window booking portal to a traveller for all his travel needs, including flights,hotels, cars or tour packages. The portal provides extensive range of complete tour packages, from a short weekend tour, expansive leisure holidays, hill stations, beaches, pilgrimage, honeymoon and historical tours within India or abroad with the best rates in the industry. Speaking on the tie-up with BCCL, Sanjay Bhasin, CEO said, “We are pleased to take our BCCL partnership to the next level.” […]
Mukesh Ambani-spearheaded Reliance Industries, on Thursday said that its growth plans included greenfield investments and acquisitions besides adding 9 lakh tonnes per annum to its polypropylene capacity at its Jamnagar refinery. We will consolidate our position by pursuing greenfield investments and acquisitions in the entire value chain, RIL`s chairman and managing director, Mukesh Ambani, told shareholders at the company`s annual general meet here. The company will commission a 9,00,000-tonne per annum polypropylene facility this year at its new refinery in Jamnagar, making it the world`s third-largest producer. The company`s new 2.5 million tonne per year paraxylene manufacturing facility in Jamnagar would provide a platform for growth in the polyester business in India and overseas, he said. “The second potential avenue for growth and transformation is in alternative energy,” RIL chairman Mukesh Ambani said during the company`s annual general meeting here. “This is a natural extension of our conventional energy portfolio.” […]
Telekom Malaysia (TM) will pay Rs 150 per share for a less than 15% stake in Idea Celluar, valuing the AV Birla Group company at Rs 40,000 crore or $9.3 billion. Idea will then buy out the Modis’ 40.8% stake in Spice Communications, and TM will have 20% equity in the entity formed after merging Spice and Idea. “TM will invest around $2.2 billion in Idea and get shares in the merged company,” sources close to the development told ET. Since TM’s stake will increase through a merger, an open offer will not be required. “While TM will buy less than 15% through preferential offer, it will get a little over 5% through merger. The preferential offer for TM was a pre-condition for Spice-Idea merger as TM is keen on a bigger India play. This was the only way Idea could have got Spice, which it has been eyeing for over an year now,” said sources. With this, TM’s three-year old dream of partnering Idea Cellular will come true. Way back in June 2005, TM, in a consortium with Singapore Technologies Telemedia, wanted to acquire 47.7% stake in Idea Cellular. They wanted to buy out the stake of US telecom giant AT&T — now Cingular Wireless — for about $390 million. However, the Department of Telecom (DoT) raised objections to the deal and TM’s ambitions could not be fulfilled. […]
IDFC PE-II, a venture fund of Infrastructure Development Finance Corporation, has picked up 22% stake in the Seaways Shipping, for Rs 1.20 billion, reports Business Line. Seaways Shipping is one the leading maritime operators in the country, providing a range of shipping and logistics services. It is learnt that IDFC and JP Morgan had been in discussion for funding Seaways for some time, but the deal was finalized only about a week ago. The investment was made out of IDFC`s second fund, which has a corpus of USD 440 million. Seaways is the second investment out of the fund in the current financial year. IDFC is now looking to raise a third fund, with a corpus of around USD 700 million.(My Iris) […]
Reports suggest that the West Asian company, Al Rostamani may buy a 25% stake in Gujarat Heavy Chemicals Ltd, or GHCL for USD 200 million. Nikhil Sen, Head of International Strategy said that the West Asia initiative is an integral part of their strategy. However, he clarified that he cannot comment on the report of West Asian company's buying stake. Soda-ash is a very strong area of business for the company, he said. Sen added that the company is looking at bolstering both its soda ash and retail business in West Asia. The company is also in talks with some domestic and international companies regarding few verticals within India, he said. They may announce a deal in a few days, he said. (Money Control) […]
Gammon India Ltd. said it has acquired a 75.1 percent stake in steam turbine maker, Franco Tosi Meccanica Spa. for 40 million euros. In a regulatory filing, the company also said it has bought 50 percent in power sector services firm, Sadelmi Spa., for 7.5 million euros. SCI shares closed up 3.12 percent at 390 rupees on the Bombay Stock Exchange, and the benchmark Sensex closed up 1.99 percent at 15,185.32 points. (Forbes) […]
The AV Birla group flagship Grasim Industries on Tuesday said it has sold its sponge iron business — Vikram Ispat — to Welspun Power and Steel for Rs 1,030 crore. Grasim, in a statement issued here, said the company would transfer its Vikram Ispat undertaking into a new special purpose vehicle (SPV), to be formed as a subsidiary company of Grasim. The SPV would be funded by Welspun Power and Steel through equity investment and induction of debt to acquire the SPV and sponge iron business. The SPV would use the funds inducted by Welspun to make the payment to Grasim. The transaction is expected to be completed within the next six months, the statement added. Ravi Kastia, group executive president and business head, Grasim, told ET that the company would plough back the money into its core businesses of viscose-staple fibre and cement. […]
Mobile payments solutions provider PayMate Inda has raised $9 million (Rs 38.57 crore) in the second round of funding from three PE funds, led by Mayfield Fund and existing investors Kleiner Perkins Caufield & Buyers and Sherpalo Ventures, for an undisclosed stake in the firm, PayMate said in a statement. “Mobile electronic payments are the way of the future in India. PayMate has figured out how to unleash the potential of the phone as the primary transaction terminal for the over 260 million mobile users in India,” said Nikhil Khattau, MD, Mayfield Advisors, who also join the PayMate board. PayMate works with service providers like airlines and banks to enable transactions on mobile phones and wireless devices. Customers can buy an air ticket by sending an SMS and pay by credit card through a secure IVRS call-back service. […]
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