News Roundup: AION talks to Mercator for up to $75M deal

07 April, 2014

AION Capital Partners, the largest special situation fund in India, launched by global private equity giant Apollo and India’s oldest PE fund, ICICI Venture, is in discussions with diversified conglomerate Mercator for an investment worth Rs 420-450 crore ($70-75 million). According to people in the know, AION will invest through a structured deal, with a combination of equity and debt.  Mercator, which expanded its oil and gas business recently by acquiring an LPG carrier from Varun Shipping, will use the fund for further vessel buyouts and clearing its debts. (Business Standard) 

CIL receives Rio Tinto, GVK Group proposals to sell coal mines: State-owned Coal India Ltd (CIL) has received at least 60 proposals from firms including Anglo-Australian miner Rio Tinto Plc and the GVK Group to buy equity in their coal mines. CIL seeks to consolidate its position as the world’s largest coal miner, leveraging around Rs 45,000 crore ($7.5 billion) cash on its books and the bargains on offer. Of these, around seven proposals have cleared the initial stages and are under consideration. This follows a similar attempt by another state-owned entity, NTPC Ltd, to consolidate its position as India’s largest power generation company by acquiring distressed assets in the backdrop of reasonable valuations. (Live Mint) 

ONGC Videsh Ltd follows Rosneft, to pledge future oil for $700 million loan: ONGC Videsh Ltd, the overseas investment arm of flagship explorer Oil and Natural Gas Corporation, is considering pledging future oil production to raise up to $700 million (Rs 4,185 crore) for bankrolling the over $4 billion acquisition of stake in a Mozambique gas field. In 2005, Russian giant Rosneft had pledged oil supplies for 25 years to China for a $6 billion loan from Chinese banks to fund its buyout of Mikhail Khodorkovsky-led Yukos Oil. ONGC Videsh had teamed up with Oil India Ltd to pick up Videocon’s 10% stake in Mozambique’s Rovuma Area-1 filed for $2.4 billion. It followed up this deal by picking up another 10% stake in the same field from US major Anadarko Petroleum for $2.6 billion. The 10% Videocon stake is being shared in the ratio of 60:40 between ONGC Videsh and OIL. (The Times of India) 

OVL to offload equity in Vietnam block: ONGC Videsh Ltd (OVL) is in talks with PetroVietnam to offload its stake in Block 128 in the disputed South China Sea. The overseas arm of the government-controlled Oil and Natural Gas Corporation (ONGC) had got a two-year extension ending June 2014 for the block, which it had earlier planned to exit. The extension came after Vietnam offered additional data which could help the block become commercially viable. OVL would retain the majority 51 per cent stake in the block, which the Chinese had claimed was in its territorial waters. Vietnam had in November 2013 also offered to give OVL five offshore oil and gas exploration areas without bidding in order to counter China’s influence in the region. The five blocks or areas – 17, 41, 43, 10&11-1 and 102 & 106/10 – lie outside the territory claimed by China in the South China Sea. (Business Standard)

Manthan gears up to raise $50 mn: In a move that will pave the way for the exponential growth of the Bangalore-based analytics player Manthan Systems, global big-ticket private equity players are in various stages of discussions to invest upwards of $50 million (Rs 299 crore) in a fresh round of funding. Manthan Systems, one of the early movers in the analytics space has so far raised around $50 million of funding through multiple rounds which also set the platform for healthy partial exits for the earlier investors in the company. The company is understood to be looking to raise fresh resources for business expansions as well as provide partial exits for its existing investors. (Business Standard) 

WPP may buy ad company Temple Advertising; deal value likely to be over Rs 200 crore: WPP, the world’s largest advertising company, is set to buy Bangalore-based creative agency Temple Advertising, according to people close to the development in the two agencies. They said the deal, which could be valued at over Rs 200 crore ($33 million), could be signed as early as April 15. WPP is currently engaged in 18 to 20 different acquisitions across the Asia-Pacific region and Temple Advertising is definitely one of them. Temple will be merged with Bates CHI & Partners in a bid to pull the agency out of the slump.  If final talks go through on April 15 or April 16, the entire process of merger and integration with Bates will be over by July. (The Economic Times) 

Ashika Capital offers its services to crisis-hit First Leasing: Chairman: First Leasing Company of India Ltd, which has been looking for an entrepreneur to take over the management of the crisis-ridden company, today said Mumbai-based merchant banker Ashika Capital Ltd had offered its services for an equity sale or strategic partnership to the company. “Since all payments from the company’s collections are subject to RBI/bankers’ approval, the company shall seek their approval for the payment of fees. After receipt of their approval, the company shall proceed further in this regard,” he added. (Business Standard) 

IAN programme for agri, supply chain start-ups: Indian Angel Network (IAN) has announced a virtual incubation programme for start-ups working in agriculture and supply chain. Called FEML (Farm-to-Market Logistics), the programme will provide access to funding and technical assistance by industry experts to start-ups trying out innovative methods to make supply chain work better. The virtual incubation programme is managed by IAN and supported by Michelin. Shortlisted innovators and entrepreneurs will receive assistance on designing their products or service, building the prototype, getting customer validation and preparing the foundation for commercialisation of the idea. (Business Line) 

Bharti Airtel to raise $400 million in overseas debt shortly: As part of its $2 billion debt raising plan, India’s largest telecom firm Bharti Airtel is set to tap the overseas bond markets again with $400 million (Rs 2,391 crore) issue later this month to repay high cost loans. “Bharti will be raising around $400 million in the next three-four weeks from an overseas offering,” a merchant banker associated with the issue told PTI. It had raised $400 million equivalent from the Swiss market last month, after the 250-million euro issue in January and another 750-million euro issue in December. That apart, it has raised $1.5 billion in two tranches in March 2013. (Business Standard) 

Piramal Enterprises seeks to sell diagnostic solution business: Piramal Enterprises Ltd, the flagship of the Ajay Piramal Group, plans to divest its diagnostics unit, one of the two consumer-facing businesses remaining in its portfolio, having sold its generic medicines unit to Abbott Laboratories for the equivalent of $3.72 billion and its diagnostics services business to SRL Ltd in 2010. Potential buyers that have shown interest in acquiring the diagnostics unit include the laboratory diagnostics arm of Siemens Healthcare and Abbott Diagnostics, a division of US-based Abbott Laboratories, said three persons familiar with the development. The divestment follows the company’s decision to exit from businesses that don’t fit into its new strategy of concentrating on segments that do not need a retail presence in a large way. (Live Mint)

Courtesy: VCCEdge

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News Roundup: AION talks to Mercator for up to $75M deal

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