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News Roundup: Govt. May Allow FDIs in Domestic Airlines

14 January, 2009

Unitech Plans to Raise $560 Million From PE Funds – One of the largest real estate developers in India, Unitech is in talks with Private equity fund for investments up to $560 million (Rs 2,750 crore). According to sources, the realty giant is also in negotiations with banks to restructure an additional Rs 500 crore of loans as part of its plan to cut debt and secure funding to complete existing projects. The troubled realty firm plans to draw down $110 million (Rs 540 crore) from Unitech Real Estate International Fund to invest in its realty projects in the National Capital Region (NCR). The realty major is also in talks with PE funds to raise $300 million (Rs 1,480 crore) at the corporate level and as much as $150 million (Rs 740 crore) for specific residential projects being developed in Hyderabad and Kolkata. (Business Standard)

Govt. May Allow FDIs in Domestic Airlines – The government may soon allow foreign airlines to pick up minority stakes in the domestic airlines. According to sources, the government is considering the plan to allow foreign airlines to pick up 20%- 25% stakes in the domestic airlines to help the troubled sector. However, no firm decision has yet been taken. Currently, foreign airlines are debarred from holding a direct or indirect stake in domestic airlines. (Business Line)

TCL to raise Rs 1,000 Crore through Rights Issue – Tata Communications (TCL) is planning to raise around Rs 1,000 crore through a rights issue. TCL has approached the government, which holds 26.12 per cent stake in the company, to relax the shareholder agreement to enable it to raise fresh resources through equity and debt, or through divestment of its holding in Tata Teleservices. In case the government approves the issue, it will have to invest RS 260 crore to retain its stake in the company. (Business Standard)

Tata and Birla Plan Mid-Size PE Deals – Top business groups in India, Tata and A V Birla are planning to capture small and medium-size deals. While the Tatas are looking for PE deals of about $50 million or less, the Birla group is planning deals of around $25 million. Tata group plans to invest about 15 per cent of the first corpus on its own as anchor investment. Tata Capital had earlier announced its plan to raise $400-500 million as its first fund for the PE business. (Business Standard)

NELP VIII Auctions of Oil and Gas Blocks May Be Delayed – The eighth round of auction of oil and gas blocks under the New Exploration Licensing Policy (NELP VIII) might get delayed beyond February 2009 owing to the current financial and economic situation in the country and across the world. NELP VIII is offering 400,000 square feet of area and there are over 100 blocks to be awarded. However, an in-principle approval from the Ministry of Environment is yet to be received and the planning is still in the preliminary stages. (Business Standard)

Bidding for Gas Distribution Networks to Start by Jan-end – The bidding process for setting up city gas distribution networks in 14 identified cities is likely to begin by the end of this month. In the first phase the bidding would take place only for 6 cities as a lot of planning is required on the part of the bidders. The bids will be invited for cities like Kakinada, Bhopal, Mathura and Kota. The expressions of interest (EoIs) for these cities have already been received from GAIL Gas, a subsidiary of GAIL India, Gujarat Gas, Great Eastern Energy Company and Reliance Industries. While the 6 bids involve an investment of around Rs 2,400 Crore, each city will require around Rs 400 crore for pipeline and marketing infrastructure. (Business Standard)

UP Government to Sell 33 Corporation Sugar Mills – The Uttar Pradesh government is planning to sell 33 ailing state sugar corporation mills, aiming at total privatisation of the sugar sector. A similar effort made by the UP government last year had failed to materialise. The government has invited request-for-qualification and request-for-proposal (RFQ-cum-RFP) from advisors having experience of handling privatisation of at least one assignment of the central or any state government. Soon the government will also undertake a similar process for selling the 28 ailing cooperative sugar mills, which are located mostly in rural areas. The last date for filing the documents with the state principal secretary, sugar industry and cane development, is February 3. (Business Standard)

Jubilant Organosys in JV with US-based BioLeap for Drug Discovery – Pharmaceutical firm Jubilant Organosys has entered into an agreement with the US-based BioLeap for drug discovery. Under the agreement, BioLeap’s computational fragment based drug design platform would be integrated with Jubilant’s expertise in other different areas to offer a highly competitive preclinical drug development platform. (Business Standard)

Satyam- Cisco JV Likely to Fall Through – Satyam Computer Services’ JV with the leading multinational network solutions provider Systems, Cisco Systems is likely to fall through. With Satyam mired with a Rs 7,000 crore fraud, Cisco has said that it is not in an obligation to make investments towards the joint venture. The two firms had announced a joint venture in October 2007 to focus on healthcare management solutions.  Cisco had expressed a strategic intent to make a minority investment in the new venture. (The Economic Times)

Infosys Plans Acquisitions in Consulting and ERP Space – Infosys Technologies is looking to acquire companies in areas such as consulting and ERP. According to sources, the buyout could entail firms with revenue up to $1 billion. Right valuation and geographic penetration would be the drivers for the acquisition. Infosys was also in the race to acquire UK consulting firm Axon Group, though it could not buy out the firm as HCL had made a trumping offer. (Business Line)

DLF Assets Plans to Raise $450 Million – DLF Assets (DAL) is planning to raise $450 million (Rs 2,187 crore) from a clutch of private equity investors. The company is also considering the option of raising funds through debt from domestic banks and external commercial borrowing (ECB). DAL has been attempting to raise fund for sometime now and JP Morgan is advising the firm on it. (Yahoo Finance)

Kabir Mulchandani Arrested in Dubai for Multi-Crore Fraud – Kabir Mulchandani, chairman of Dynasty Zarooni has been arrested in Dubai in connection with a multi-crore real estate fraud. Mulchandani has allegedly defrauded many investors of over $ 100 million. According to the investors, in March Mulchandani had received subscription fees of $ 81,697 (Rs 40 lakh) a month from 12 members. He promised them returns of $ 272,242 (Rs 1.3 crore) a month after six months, or $ 1,633,453 (Rs 8 crore) in September. Mulchandani also owns two companies Baron International and Baron Electronics, which owe the government nearly Rs 60 crore and Rs 37 crore respectively. (The Economic Times)

 

 


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News Roundup: Govt. May Allow FDIs in Domestic Airlines

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