VCCircle News

Citi Deal To Help Apollo Build Up Realty Portfolio In India

Madhav Chanchani — Fri, 12 Mar 2010 04:40:20 -0800

Global private equity house Apollo Management LP may assume control of about seven to eight investments of Citi Property Investors (CPI) in India, on which it is currently holding due diligence. Apollo is in advanced negotiations to take over Citigroup's real estate unit, CPI, with assets worth over $12.5 billion under management globally.

In India, this could see some of CPI's key investments passing over to Apollo giving the latter a fairly well-spread real estate portfolio to start with. Among the marquee investments of CPI are $55 million investment in Nitesh Estates, its multiple investments worth over $200 million in New Delhi-based BPTP, $20 million in True Value Homes in Chennai and another $50 million commitment into Gera Developments in Pune.

A Citigroup India spokesperson offered no comment, when contacted.

Meanwhile, Citigroup has been trying to offload some of its structured finance deals with a few domestic real estate firms like Golden Gate Properties Ltd in Bangalore, independently. Also Citigroup Venture Capital International's real estate investments like Emaar MGF will not be a part of this deal.

Apollo is expected to take over 74% CPI stake in a JV with Nitesh Estates, which is developing India's first Ritz Carlton hotel in Bangalore. Incidentally, Nitesh, which has the option of buying back a part of the stake from Citi at a later date, is in the midst of Rs 550-crore IPO roadshow currently. Though CPI had originally committed $360 million investment to various projects of Nitesh Estates, it deferred the rest last year and only went ahead with Ritz Carlton deal.

Most of CPI's investments are at project level barring its 5.89% stake at the parent entity of BPTP.

The acquisition of CPI will could also give New York-based Apollo access to investments across Asia. CPI closed CPI Capital Partners Asia Pacific, LP in February 2007 with commitments totaling $1.29 billion. This fund has a primary focus in Greater China and India.

Apollo recently made its debut private equity deal in India by investing $100 million in direct to home satellite TV company Dish TV. Apollo Management's affiliate, Apollo Real Estate Advisors, already runs a $650-million real estate private equity fund in India in partnership with Delhi-based Khemka family's SUN group. But Citi Property Investor's assets are expected to come directly to Apollo, which would give it a direct presence in the Indian real estate market. The deal, being done at a global level for which the interim agreement has been signed, is expected to unveiled in a month's time.

An email sent to Apollo's India chief Mintoo Bhandari for comments did not elicit any response.

The deal is part of Citi's efforts to raise funds from selling assets. Citigroup's arms have also recently exited investments in India’s largest commodity exchange Multi Commodity Exchange of India and telecom tower arm of Bharti Airtel.

Last year CPI promoted its India head, Ravi Hansoty, as the interim head of its pan-Asian real estate platform the Asia head David Schaefer moved out.

By far, CPI's largest exposure is to BPTP, where it picked up a 5.89% stake in the entity for Rs 322 crore ($80 million) in August 2007. Subsequently it also picked up stakes in three associate companies and subsidiary of BPTP for another Rs 399 crore ($99 million) in April 2008. The fate of the entity level investment remains to be seen as BPTP recently said is planning to go for a Rs 1500 crore public offering early next fiscal.

It also has an investment in TVH Estates Chennai Pvt Ltd, a Rs 700-crore residential project near Chennai developed by construction firm True Value Homes. The developer is believed to have the right to buyback CPI's investment in the project. CPI also has a 50:50 joint venture with the Gera Developments for a residential project in Pune.

Clarification: Apollo Real Estate Advisors is now known as AREA Property Partners and has no affiliation with Apollo Global Management. AREA’s name change and formal separation from Apollo Management were implemented in 2009.

Nine Rivers Capital Invests $7M In Global AgriSystem

Sarimul I Choudhury — Fri, 12 Mar 2010 02:43:24 -0800

Nine Rivers Capital Limited (NRC), an SME-focussed private equity firm, has invested $7 million in New Delhi-based Global AgriSystem Pvt Ltd (GAPL).

Along side the investors, the promoters of GAPL have also participated in this funding round. Corporate Finance Associates (CFA) India acted as exclusive advisors to GAPL for this transaction.

GAPL is promoted by Ramesh Vangal-backed Katra Group along with Gokul Patnaik, an agriculture supply chain veteran. The company offers procurement, storage, processing and distribution services for fresh fruits & vegetables. It operates six agri-hubs in and plans to expand its footprint to 20+ agri-hubs over the next three years.

GAPL recently acquired a company having a brand as well as distribution for exotic vegetables supplying to more than 150 leading hotels in the country.

GAPL chairman Gokul Patnaik says, “with rising discretionary spending in India, consumers are demanding all season availability of quality fresh produce. GAPL is well positioned to act as a smart supply chain enabler for its clients, be it organised retailers, processors or others, such as hotels."

According to Kunal Kumthekar, Founder-Director, Nine Rivers Capital Holdings Pvt. Ltd, "GAPL can aspire to grow manifold as a leader and provide strategic direction to the fresh produce SCM business in the country.”

The private equity firm had earlier picked up a minority stake in Navi Mumbai-based Pranav Construction Systems for Rs 50 crore. Pranav Construction is a formworks engineering solutions provider. Nine Rivers also put Rs 27.5 crore in GPT Infraprojects Ltd (GPT), a Kolkata based company providing infrastructure enabling services. The mid-market private equity firm achieved the first close of its debut fund at $46 million in the first half of 2009. It aims to raise $125 million.

Infrastructure Continues To Be Strong Story On AIM

Shrija Agrawal — Thu, 11 Mar 2010 21:28:30 -0800

The Alternative Investment Market (AIM), the junior market of London Stock Exchange, saw the lowest level of fund-raising last year in its 15-year history. This was pretty much in line with the state of IPO markets all over the world. Marcus Stuttard, who was appointed as the head of AIM in April last year, had a busy time last year as “there was much to be handled at home itself.” The exchange saw a lot of action from Indian companies across sectors – real estate, media and commodities – but shareholder activism appears to have played a spoiler. In an interview with VCCircle, Studdard who was recently on a roadshow to India, an economy that is registering positive growths and is attractive to AIM, he talks about investor appetite and concerns on shareholder activism. Excerpts:-

How important is India as a market?

Indian companies registered a 212% increase last year in 2009. We are essentially here to understand the performance of the promoters and build the future pipeline. We did see a couple of fund raisings last year. In 2008, 18% of the fund-raising at AIM was by Indian companies. That aligned with the performance indices of the Indian companies this year demonstrates a healthy investor appetite. We see a lot of corporate interest and we expect to see a lot of fund-raising by Indian companies at AIM.

What are you making out of the pipeline here?

A lot of trends that we see globally apply here too. One of the important side effects of the financial crisis is that for a certain type of sectors, particularly technology, debt finance isn’t just appropriate. And for these small and mid-cap technology companies, raising equity has always been a difficult proposition. For companies who have international aspirations and look to raise equity, AIM serves the purpose well. We saw a lot of real estate, media and tech companies tapping AIM in the previous boom.

What are the unique features of AIM?

One of the key strengths of AIM (as compared to other growth markets) is that we have never designed it in such a way that there is a specific sector or jurisdiction focus. We focus on a very wide range of sectors and a very strong critical mass. During the dotcom bust, a lot of markets fell as they were dominated by technology. In any business cycle, there will always be a certain sectors in which AIM has had prominence--energy, commodities and real estate--and that makes us stronger as we enter into our next phase of development.

We conducted a review of AIM regulation at the end of 2006 not that we had any regulatory failures but just to sustain our brand building in a very fast growing environment. We got corporate finance houses or investment bankers called the Nominated Advisors (Nomads) on to the corporates being listed on our markets. These nominated advisors have to work with those corporate, look after their finances, due diligence and are held responsible for all their admission documents. So, before any companies get listed on the AIM, these institutional investors look at the track record of the corporates. So, it’s the Nomads reputation that is at risk.

Besides, a new rule book got designed in 2007 which dealt with the best practises of due diligence and corporate governance We maintain a balance that companies have access to capital at reasonable cost and investor protection. AIM companies were able to raise 5.5 billion pounds last year. This shows that investors believe in the practises and some of the regulatory standards that we follow.

What is the perception about AIM here? From a valuation perspective, how enticing is it for a corporate to look at AIM?

The perception of AIM is strong. We have a critical mass of sectors and a long-term institutional investor base for small and mid-cap companies. We find that, with companies looking to raise between $50 million and $150 million, valuation has been higher compared to other growth markets in the world. We just don’t have generalist funds but funds specialising in small and mid cap companies, and the infrastructure around these funds is such that the investor focus, valuation statistics, and liquidity event are all driven by their peer large companies. Promoters should not be thinking about valuation from day one but long-term progression in valuation.

Corporates today have a lot to access to private equity money. How does that compare with raising funds on the AIM?

AIM will not pitch against private equity or the domestic markets. For certain types of companies, AIM may be a more appropriate mode of fund raising. But companies, that have international aspirations, have had previous rounds of finance and now want to look up to equity markets should look at AIM. They have a lot of spinoff benefits at AIM. From what I hear, a lot of technology companies, when they got raised, they stood to benefit as a lot of their performance gets rated or analyzed against the performance of a peer large public equity company which helps them get supply contracts, projects and become much more visible. This gives the company a confidence than just looking inward and relying on PE finance. There are other benefits like incentivising the key staff.

What are the sectors in India which are attracting the interest of institutional investors?

What we are expecting to see in business cycles is that more established companies are looking at an IPO. The investors are looking at much more certainty than they were in 2006-07, probably at slightly more mature companies. Technology and cleantech seem to be coming back. But, infrastructure continues to be a very strong story as international institutions have a clear understanding that there is a significant growth here and are looking at exposure there.

There has been a lot of news about shareholder activism in Indian companies listed at AIM (Hirco, Trikona)? How do you address this perception?

I don’t think it’s a wider issue but just related to specific companies. The kind of shareholder activism seen at AIM companies is no different from strategic private equity finance be it the expulsion of the directors or hiring new board members. You got to expect this anywhere. But the major lesson learnt here is that companies need to understand that the day they are listed they are public companies with external shareholders. The last thing that an investor wants is a surprise, good or bad. Investors need to be sure that they are in investee companies where they can trust the management teams. Companies need to think about their investor relations and communication and the need to maintain constant dialogue with their investors. These investors, by virtue of them being long term public equity investors, are much more knowledgeable than private investors who look at capital appreciation in a short term. They don’t really want to manifest themselves into shareholder activism.

How long-term are these institutional investors?

The institutional investors tend to take a long-term view. Valuations that we saw in the recent past were not really because of shareholder withdrawal but because these long term institutional investors were holding on to the companies that they have invested in. In the last 18 months, the core investors have stayed with the core team, more often than not. Markets globally are adjusting to new sense of realities. Any company preparing for an IPO or coming to the markets now should really think about how they want to do their investor communication.

SingTel Signals Support For Bharti-Zain Deal

Sarimul I Choudhury — Thu, 11 Mar 2010 22:51:05 -0800

Singapore Telecommunications (SingTel) may help with the funding for Bharti Airtel's $9 billion acquisition of Zain's African assets, a senior SingTel executive said on Friday.

SingTel, Southeast Asia's largest telecoms firm that owns 32 percent of Bharti, said the acquisition would be financed by debt, and there was no need for it to inject money directly into its Indian affiliate since the deal would not dilute its stake.

"In one way or the other we will be part of the funding, we are a very substantial shareholder of Bharti," the CEO of Singtel's international operations, Lim Chuan Poh, told Reuters in an interview.

Bharti and Zain are in exclusive talks until March 25 for the Kuwaiti firm's operations in 15 African countries and have agreed on an enterprise value of $10.7 billion for the assets, including $1.7 billion of debt on Zain Africa books.

Bharti's bid is in line with the ambitions of SingTel, which is sitting on over $1 billion in cash and wants to enter the fast-growing African market to offset its presence in more saturated telecoms markets such as Singapore and Australia.

SingTel supported a bid by Bharti to buy South Africa's MTN, but the deal collapsed last year.

The market value of Bharti, the leading Indian mobile operator, has plunged since it confirmed the Zain deal on concerns that possible high debt for funding the transaction could stretch its balance sheet.

"It will definitely be through debt for the amount that we are talking about," said Lim, a former Singapore government bureaucrat who joined SingTel in 1998.

Sachin Mittal, an analyst at DBS Vickers in Singapore, said that even if the Bharti deal was fully funded by debt, it would still be a manageable exposure for SingTel.

"Bharti is betting on a significant improvement in Zain's operations, and I see reasonable strength in that argument. There is significant scope of improvement in Zain, not just in mobile but in fixed line and the corporate market," said Mittal, who has a "buy" rating on SingTel.

SingTel, 54 percent owned by Singapore state investor Temasek, has spent S$18 billion in recent years to buy stakes in fast growing telecoms markets such as India and Indonesia.

The company has previously said it is also interested in Vietnam, where it has no presence, but Lim said costs were now outweighing revenues in the mobile market there because of price competition among operators.

"The prospect has gone from very good to pretty dicey," he said. "But we do not believe the future will be in pure mobile."

Lim said Vietnam still interested SingTel given the growth outlook for providing broadband and data services in a country with a young population and a growing middle class.

DIVESTING POSSIBLE

Lim, just back from a trip from Vietnam, said he travelled so much for his job he avoided going overseas in his free time. Lim runs the firm's international operations while Allen Lew heads SingTel's domestic business, both reporting to Group CEO Chua Sock Koong.

Lim said the firm was not necessarily looking to buy further assets directly, if it felt its associate firms could execute deals and operate in target countries more effectively.

"We are not egotistical about it. We have to be pragmatic...We do not believe in competing with affiliates."

Lim said divesting assets was also a possibility, but not for its core business. He declined to comment on the possibility of an IPO for its fully-owned Australia unit Optus, and said this was a core asset that had been doing well.

"One potential consideration would be Bangladesh. We are not divesting to exit, we are divesting to consolidate," he said, adding the company is open to divesting its Bangladesh holdings if Bharti approached it with an offer.

In January, Bharti agreed to acquire 70 percent of Bangladesh's Warid Telecom, while SingTel already has a 45 percent stake in Pacific Bangladesh Telecom.

SingTel's shares closed 1 percent lower, versus a 0.3 percent drop in the broader Singapore index. The stock, which has a market capitalisation of about $36 billion, the biggest in Singapore, is still up 1 percent so far this year, outperforming a 0.6 percent dip in the index.

Rabo Equity Invests $10M In The Global Green

Sarimul I Choudhury — Fri, 12 Mar 2010 03:24:25 -0800

Rabo Equity Advisors, an Indian food and agribusiness-focused private equity firm, is investing $10 million in The Global Green Company Ltd, a group company of diversified Avantha Group. The investment is made through Rabo’s $120 million India Agri Business Fund, which makes
growth funding in food and agribusiness companies in India, said a Rabo Equity statement.

India Agri Business Fund has also raised another $20 million commitment from Capvent AG and its affiliates, taking its fund size to $120 million.

This is the first investment of the India Agri Business Fund this year. It has earlier invested in edible oil seed company Geepee Agri Pvt Ltd, agri inputs firm Sri Biotech Laboratories and LT Foods and Daawat, both of which are in the rice space.

The Global Green is engaged in cultivation, processing and marketing of food products including gherkins, pearl onions, cherries and sweet corn.

The company believes the fund will help it expand its business to achieve its next level of growth. “We have aspirations of building our brands and develop a more robust India business,” said Vineet Chhabra, MD & CEO, The Global Green, in the statement.

The company has operations in 50 countries globally, and has manufacturing plants in India, Hungary, Belgium and Turkey. It claims to have achieved sales turnover of $150 million in last fiscal.

India Agri Business Fund is a Rabobank initiative with commitments from International Finance Corporation (IFC), FMO bank of Netherlands, DEG, Capvent and CDC Group being the other investors. Parent firm Rabobank also has an option to invest another $25 million in the fund.

News Roundup: Danish Co ISS Buys Majority Stake In SDB Cisco

Sarimul I Choudhury — Thu, 11 Mar 2010 20:02:14 -0800

Danish Co ISS Buys Majority Stake In SDB Cisco - Integrated Service Solutions (ISS), a Denmark-based facility management company, is acquiring a majority stake in security services firm SDB Cisco for around Rs 150 crore. Chennai-based SDB Cisco is a 60:40 joint venture company between the MAC Group-promoted listed Sicagen India and Singapore-based Certis Cisco. ISS is acquiring MAC's stake in the JV. (Economic Times)

Manipal Health To Raise PE - Manipal Health Systems Pvt Ltd, a Bangalore-based healthcare company, is planning to raise private equity for funding expansion. The company is already in talks with some PE firms. It plans to utilise the funds in adding beds and improving services. The company, which currently has a network of 15 hospitals with a total of 4,000 beds across 10 locations, also eyes acquisition in this space. (Nasdaq)

Bajaj Family To Up Stake In Holding Co – The members of the Bajaj family are selling a part of their personal stakes in group companies to generate cash to pay for the preferential warrant issue of Bajaj Holdings and Investment Ltd, the listed holding company of its flagship firm Bajaj Auto Ltd. The promoters plan to raise their stake to around 50% in Bajaj Holdings from 30.69% now. (Mint)

Speciality Restaurants Plans Buys In South - Speciality Restaurants Private Limited (SRPL), the fine dining restaurant chain which operates brand like Mainland China, is planning inorganic route to expand operation in the southern region. The company is in talks with two south Indian food chains for possible acquisitions, and is expecting the deal in the next few months. Besides acquisition, the company also plans to add 40 more outlets to have a total of 100 outlets by the end of 2010. (Hindu Business Line)

GSPC To Go IPO In May - Gujarat State Petroleum Corporation (GSPC), the flagship company of GSPC Group, is planning to hit the capital market with its initial public offer by May this year. The government is planning to dilute 10-15% stake to raise about Rs 3,000-3,500 crore in the process. (BS)

Nakhate To Start Second Term In BofA-ML – Kaku Nakhate, a former Bank of America Merrill Lynch (BofA-ML) executive who left the firm a year ago to join JP Morgan, will re-join BofA-ML as country head. She was the vice-chairman and the head of the equity business of JP Morgan India recently. Nakhate was in Merrill Lynch earlier for over 18 years, and was the head of global markets including equities and fixed income business when she quit the job. (ET)

SK Birla Ups Stake In Digjam - Bangalore-based SK Birla group has increased its stake in Digjam to 30.4% acquiring 3.6% more from Asset Reconstruction Co (Arcil). Digjam is a manufacturer of fabric for suits and casual wear and exports half of its products overseas. SK Birla is planning to increase its stake further in the company in the future. (ET)

Fortis To Fund Parkway Buy Via Loan - Fortis Healthcare, the hospital chain which is acquiring 24% stake in Parkway Holdings for $685 million, plans to fund the buy through a short-term loan and the money raised through its recent rights issue. The company will go for a short-term loan to fund the deal as it puts in place a plan to raise money through equity, warrants, or currency bonds. (Reuters)

LSE-Listed Infrastructure India Faces Shareholder Ire

Madhav Chanchani — Fri, 12 Mar 2010 02:27:20 -0800

Shareholder activism continues to hit overseas listed firms with predominantly India operations. After the cases of Hiranandanis-led Hirco and Trikona Trinity Capital both listed on AIM, LSE-listed Infrastructure India Plc (IIP) is now facing an extraordinary general meeting (EGM) next month that could potentially see the removal of three out of existing four board of directors as proposed by one of its key shareholders, Advance UK.

Advance UK, that owns 10.1% stake in IIP, had last December requisitioned a meeting to remove the directors and replace them with two of its own nominees. Advance UK has alleged high overheads with IIP and said the firm should be merged with a large infrastructure company.

In addition, it has alleged that the IIP board did not adequately consult the investment advisor nor the shareholders before committing investment in the transportation and logistics sector in India by picking 26% stake in toll road project in central India, Western Madhya Pradesh Infrastructure & Toll Roads Ltd (WMPITRL).

IIP has made two investments till date: Rs 110 crore for 6.23% in Shree Maheshwar Hydel Power Corporation Limited (SMHPCL), besides Rs 96 crore for 26% stake in WMPITRL. The two deals worth over £24 million accounts for over two-thirds of total funds raised through the IPO in June 2008.

SMHPCL was specifically established to own and develop a 400MW hydroelectric power project situated on the Narmada River in Maheshwar (Madhya Pradesh) and first of the 10 turbines of 40MW each to be installed and commissioned at the project due to be operational in the first half of 2010.

WMPITRL has a toll road project comprising a single 125 km stretch of road and is part of the local state government sponsored road upgrade programme. While tolling operations were originally anticipated to commence around April 2010, partial tolling commenced on approximately 67 km of the road. The project however has a cost overrun and IIP had to put in more money.

In the recent past, IIP has replaced its investment advisor Bloomsbury Asset Management Advisors (BAMA) after the latter, apparently, faced staff exits with Akur Partners LLP who has been brought in as ‘retained asset advisor’. Advance UK has apparently also pitched for bringing back BAMA as an investment advisor.

Incidentally, Advance UK is itself looking to fold up. It has a scheduled shareholders meeting for voluntary liquidation early next week.

IIP management in its circular to equity owners have stated that it has received responses from shareholders representing 25% of the equity capital who are going to reject the proposal of Advance UK. IIP has further asked shareholders to reject the Advance UK proposal as it would derail the accrual of revenues that are going to begin from the portfolio companies in India.

Also since Advance UK is in the process of liquidating its shares would most likely be sold and as such it would have no say in the future strategy of IIP, so the company has asked shareholders not to accept the Advance UK proposal.

In a statement, Advance UK has pointed out that even after the vote for liquidation next week, it would continue to hold IIP shares up to one year and will not be a forced seller. It added, "the directors (of IIP) have the support of one large shareholder; we believe that all the other major shareholders are frustrated with the small size of the company, the high overheads, directors that ignore shareholders and the share price. They do not want a dilutive share issue. They do not want new investments that will take many more years to mature. The proposed new board (of directors) is ready to tackle the company's problems and is happy to discuss the future of the company with shareholders."

Fortis Buying 23.9% In Parkway Holdings For $685M

Madhav Chanchani — Thu, 11 Mar 2010 03:44:40 -0800

Fortis Healthcare Ltd (owned by former promoters of Ranbaxy) is acquiring 23.9% stake in Singapore-based healthcare services firm Parkway Holdings from private equity biggie TPG Capital for around $685 million. The deal apparently has been struck at 14% premium to the value of TPG’s stake as of closing price of Singapore Stock Exchange listed Parkway, as per VCCircle estimates.

Other big investors in Parkway include Khazanah Nasional, the sovereign wealth fund of Malaysia, that is the second largest shareholder of Parkway with 23.32% stake.

Besides being the first significant overseas acquisition by an Indian firm in the healthcare services space, this deal is also the largest outbound deal by an Indian company since 2008. The big outbound deal announced was Oil and Natural Gas Corp. Ltd’s $2.6 billion (Rs 12,428 crore) takeover of Russia-focused Imperial Energy Corp. Plc in August 2008.

Parkway Holdings Limited is one of the region's leading providers of healthcare services, with a network of 16 hospitals with more than 3,400 beds throughout Asia, including Singapore, Malaysia, Brunei, India and China. Interestingly, Parkway also has a joint venture with Fortis rival Apollo Hospitals for Kolkata's Apollo Gleneagles Hospital. Parkway is also developing a greenfield hospital in Mumbai in a joint venture with Koncentric Investments Ltd.

In Singapore, it owns Parkway Group Healthcare Pte Ltd and Parkway Hospitals Singapore Pte Ltd, which operates three of Singapore's top healthcare providers: Gleneagles, Mount Elizabeth and Parkway East Hospitals. For the year ended December’09, Parkway Holdings had revenues of $700 million with net profit of $89 million.

Fortis scrip rose 4.8% to close at 178.35 at BSE on Thursday giving it a market capitalisation of Rs 5,659 crore ($1.2 billion). Parkway scrip rose 2.6% to S$3.12 at Singapore exchange which gave it a market value of $2.5 billion. At this price, TPG’s stake is valued at $602 million (around 16 times EBIDTAR) as against $685 million that Fortis is paying. It could not be immediately ascertained if Fortis will like to buy more stake.

For Fortis Healthcare, this is the second large deal in less than a year and its biggest yet. Last August, it acquired 10 hospitals from financially troubled Wockhardt group for around $187 million in India.

Recently Fortis had announced plans to raise Rs 1,250 crore ($275 million) to acquire hospitals. It got board approved to raise the money through preference shares, overseas shares or foreign currency bonds. "It's better to keep the warchest ready for any opportunity rather than start scouting for money when we need it. We know what we want and we know what's available. We want something that is complementary for us," Shivinder Mohan Singh was quoted in news reports last month.

Fortis that currently operates 38 hospitals, had indicated it was eyeing revenue of $1 billion by 2015, from about $350 million currently. Fortis had raised Rs 1,000 crore through a rights issue last September.

Concurrent India Buys Stake In Maintenance Firm Kazi Aviation

Sarimul I Choudhury — Fri, 12 Mar 2010 01:00:14 -0800

Concurrent India Infrastructure Ltd, a Mumbai-based company engaged in construction, power and engineering, is acquiring a majority stake in Kazi Aviation & Travel Services for an undisclosed sum. Kazi, a Chennai-based company, is in the business of ground handling, maintenance and repairing of aircraft, Concurrent India said, in its filing to the Bombay Stock Exchange.

Kazi has operations in five airports including Delhi, Mumbai and Chennai. Apart from the maintenance of aircraft of domestic and international aviation companies, Kazi also supports baggage handling at various airports in India.

Concurrent India stocks were traded at Rs 21.75, up by Rs 0.55 or 2.59% at 1 pm in the Bombay Stock Exchange today. In December quarter, the company has posted net sales of Rs 5.33 crore while the net profit was Rs 7 lakh.

The two recent deals in aircraft maintenance and repairing space include Mumbai-based Air Works Engineering Pvt Ltd acquiring majority stake in Air Livery UK Plc, UK and Jet Airways India Ltd acquiring 26% stake in MAS GMR Aerospace Engineering Company Pvt Ltd.

Vishal Retail Calls Off Merger With Private Arm

Sarimul I Choudhury — Fri, 12 Mar 2010 00:03:12 -0800

Promoters of Vishal Retail have withdrawn a proposed merger of their privately-owned company Vishal Water World with the public listed financially stressed retail firm. Vishal Water World, an amusement and water park project based in Kolkata, was proposed to be merged with Vishal Retail.

This would, in effect, have pushed up promoter holding in the listed company besides bringing in additional assets to the financially beleaguered company. The merger would have taken promoters stake to 70% level as compared to 62% at present.

This development comes at a time when buyout giant TPG is reportedly looking to buy the retail assets of the company instead of picking direct stake in the listed firm.

Vishal Retail is yet to give any reason why the merger plan has been withdrawn. The withdrawal itself is interesting as a proposed selloff of retail assets to TPG would leave the company without any significant operations. A merger, if it went through, would have eventually turned the company into an operator of amusement park. Does this say something about the status of the proposed deal with TPG?

See our earlier report here.