Four private equity investors backing Jerry Rao in a management buy-in deal at MphasiS, the IT services company he founded many years ago, have jointly committed to $1.2 billion in funding. Hewlett Packard, which owns 60% in Bangalore-based MphasiS, may delay the stake divestment, which it contemplated in recent months, to focus on reviving its troubled PC sales globally. HP decision to sell MphasiS has seen PE funds approach the original founder Jerry Rao to lead a buy back of the company with revenue topping $1 billion. HP has had discussions with buyout funds such as Advent, Carlyle and Blackstone in the run up to their decision to exit MphasiS. Some funds including Carlyle and Baring have approached Jerry Rao, who sold MphasiS to Electronic Data Systems (EDS) in 2006, to help them structure an acquisition. (The Times Of India)
Foreign investors, wealthy individuals in race for Novotel hotel: Fourteen financial institutions and wealthy individuals have shown interest to acquire Hyderabad’s biggest five-star hotel, Novotel. The 305-room property, located at the Rajiv Gandhi International Airport, has been put on the block by its owner infrastructure major GMR Group. The move tracks the sell-off trend in the hospitality industry where as many as 75 branded hotels have put the ‘for sale’ boards. Hospitality specialist HVS India is running the sale process of Novotel Hyderabad Airport Hotel, which could fetch a price of Rs 350 crore ($58 million). Launched in 2009, the property is managed by French hospitality group, Accor. GMR’s goal to sell the property is to use the proceeds to invest in its other business ventures. (The Times Of India)
IL&FS eyes key coal mine stake in South Africa: The Boikarabelo mine of Resource Generation, the developer of one of South Africa’s richest coal assets, seems to be a big draw among Indian investors. After power utility CESC and steel maker Bhushan Steel, which have earlier struck separate offtake deals with the Australian miner, IL&FS Energy Development Co has now shown interest in investing in the project. IL&FS has formed a special purpose vehicle, Valu Investments Pte, in joint venture with entrepreneur Jaimin Vyas for the current bid. Its quantum of investment in the Boikarabelo mine project, however, has not yet been finalised and depends on the extent the proposed rights issue of Resource Generation devolves. IL&FS Energy, along with two other investors, have committed to pick up to 80% of the rights issue or any shortfall if existing investors don’t measure up. CESC, through its subsidiary Integrated Coal Mining, had picked up a 12% stake in the project and also has a long-term pact to explore options to build a power project at the mine site itself. (DNA)
R-Digital close to selling 80% stake to Sun TV: Reliance Digital TV, the fully-owned subsidiary of Reliance Communications that runs its direct-to-home (DTH) operations, is close to selling over 80% stake to Sun TV, controlled by Kalanithi Maran, in a deal valued at around Rs 2,500 crore ($414.8 million). Under the agreement, which is being prepared to be signed within a few days, Reliance would get a one-time cash payment in return for infrastructure and assets of Reliance DTH, while Sun TV would get full management control over the company. The due diligence for the deal has already been completed. (Business Standard)
Ex Godrej man, Arumugham Mahendran turns entrepreneur with Rs 600 crore deals: Arumugham Mahendran, who signed off as managing director of Godrej Consumer Products (GCPL) last week after an 18-year innings with the group, is close to inking two significant deals worth Rs 600-900 crore ($99.56 million – $149.34 million). First, he is in talks to buy a majority equity stake in ISS Hi-Care, a pesticide services company. Mahendran had initially helped set up this business as Godrej Hi-Care in 2009. It was later renamed ISS Hi-Care, when the Godrej Group sold it to ISS, a Danish company. Second, he is separately brewing another venture in the FMCG space, with a substantial upfront investment commitment from a large private equity fund. (The Economic Times)
Shree Digvijay plans to sell stake: The promoter of Shree Digvijay Cement Company Ltd. is planning to sell stake in the company. The promoter group has received the letter from SEBI on July 1, 2013 for the proposed stake sale on the floor of the stock exchange to comply with the minimum public shareholding requirement. (BSE)
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