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News Round Up: Citibank Freezes Satyam's 30 Operational Accounts

09 January, 2009

BHEL to Form JV with European Firm for Nuclear Forging – Bharat Heavy Electricals Ltd (BHEL) is planning to form a JV for manufacturing nuclear forgings in the current calendar year. BHEL is in talks with a European firm for the same purpose. However, it has not disclosed the name and the financial details of the firm.  The joint venture is expected to be on technology transfer as BHEL would buy technology from the foreign firm. The company is looking at a 30% growthrate in the next 3 years. It also plans to manufacture equipment to generate about 20,000 MW of power by 2011. BHEL will invest Rs 10,000 crore in the current 11th Plan on organic expansion, out of which Rs 2,000 crore has already been spent. (The Economic Times)

Citibank Freezes Satyam’s 30 Operational Accounts – Citibank has frozen over 30 operational accounts of Satyam. The accounts are trade receivable accounts. The Bank may be aiming to protect the bank’s $70-million exposure to the troubled IT major. Though Citibank’s exposure was mainly to meet Satyam’s working capital requirements, according to reports, the bank’s move to freeze trade receivable accounts will worsen the company’s liquidity situation. Satyam’s other bankers include ICICI Bank, HSBC, Bank of Baroda and BNP Paribas. (The Economic Times)

CCEA Expected to Approve IDBI Bank SPV for NBFC – The Cabinet Committee on Economic Affairs (CCEA) is expected to approve the proposal to set up a new special purpose vehicle (SPV) for infrastructure financing to non-banking finance companies (NBFCs) at its meeting on Friday. The proposed SPV will be hosted by IDBI and  will provide finance to NBFCs at an interest rate of 11.5%. the NBFCs would inturn provide financing to corporate borrowers at a uniform rate of13%. Currently banks offer finance to the corporate borrowers at a rate ranging between 12%- 16%. The Reserve Bank of India (RBI) is likely to provide refinance to the SPV at bank rate (currently 6%) plus 4%. (The Economic Times)

Rs 12 Crore Marketing Fraud Busted in Hyderabad – The detective department of the Hyderabad police busted a 12 crore fraud case involving cheating customers. The company, Niranthara Amrutha Varshini Marketing Private Limited, established by K Surendra Babu, cheated on its clients by organising schemes of multi-level marketing. He conducted meetings in his office to lure the client and offered high returns on marketing schemes. After paying the monthly benefits to the first batch of customers, he subsequently winded his business without intimating the customers and absconded. The accused is remanded to the judicial custody. (Business Standard)

ICAI Starts Investigations Against Auditors – The Institute of Chartered Accountants of India (ICAI) has written letters to the government agencies and Satyam Computer Services, seeking relevant information to initiate investigation into the role of the statutory auditor in fudging the accounts of the Hyderabad-based software services firm. ICAI is however, yet to talk to Price Waterhouse regarding the overstatement of profits by Satyam over the years. ICAI is seeking the list of auditors (both statutory and internal) employed by Satyam, and also the balance sheet and other documents filed with the Registrar of Companies (RoC). (Business Standard)

TataCom Plans to Raise Rs 3000 Crore for Buyouts – Tata Communications (formerly VSNL) has approached the government, which is a 26% stake holder, for raising Rs 1,000 crore through rights issue and another Rs 2,000 crore through debt. Tata comm. Plans to raise this amount to finance it acquisitions in the U.S and the U.K and bid for spectrum for wireless broadband. According to the sources Tata Communications is planning to deploy a part of the funds for its new submarine cable projects and possible acquisitions in the managed services space. Tata is evaluating a few targets in the U.S and the U.K in the wake of their lower valuations. (Business Standard)

FIPB to Consider Japan Tobacco Proposal Today – The Foreign Investment Promotion Board (FIPB) will consider the foreign direct investment (FDI) proposal of Japan Tobacco International (JTIL) today. The Japanese company had proposed to infuse funds into its Indian subsidiary, JTI India, in which it holds 50% stake. JTI’s proposal has been deferred twice in the board meetings following resistance from the health ministry. JTI currently plans to increase its holding to 74%. The FIPB has been informed that the Indian subsidiary of the Japanese’s firm is ready to dilute its stake. Post the revamp, the Indian subsidiary will hold 26% stake in the company and the investors keen to infuse fresh finds might join the business. The Economic Times

 

 


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News Round Up: Citibank Freezes Satyam's 30 Operational Accounts

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