Merck Plans to Acquire Indian Drug Companies – Germany based pharmaceutical company, Merck KGaA is planning to acquire an Indian pharmaceutical company and established drug brands. The acquisitions are a part of Merck’s plans to achieve a target of Rs 3,200-crore revenue from its Indian operations within the next four years. The drug major is talking to a few players in India and the discussions are in advanced stages. Merck is not looking at companies that have beaten down valuation due to the current economic situation, rather the firm plans to acquire companies that can compliment its growth plans. (Business Standard)
TCS Leads Race for Sony’s 100 Million Outsourcing Deal – TCS, India’s largest software exporting firm is leading the race to win an outsourcing contract worth $60-100 million from Sony, the Japanese electronic giant, which is struggling under huge losses. As part of its attempts to reduce cost of managing IT operations, Sony is discussing a contract to manage its desktops and servers over 3-5 years. TCS is seen as a frontrunner because of its existing relationship with the electronics maker. Tokyo-based Sony announced last week that the company would make savings of over $2 billion by reducing operational costs at its electronics unit, apart from undertaking several restructuring measures, including outsourcing. (The Economic Times)
Fortis Healthcare, With Local Partner, to Acquire 51% Stake in Clinique Darne – Fortis Healthcare has acquired 51% stake in a Mauritius based hospital chain Clinique Darne along with a local partner for an undisclosed amount. Clinique Darne has said that will reinforce its balance sheet with infusion of fresh capital from two new investors, Fortis Healthcare and Novelife. The alliance between Fortis Group and Clinique Darne would not only provide the Clinique with much required funding but would also ensure that quality healthcare in terms of tertiary care in all the specialties is provided to the people of Mauritius. The transaction is subject to the approval of the relevant authorities and of Medical and Surgical Centre Limited shareholders. (The Economic Times)
RBI to Formulate Guidelines for Govt. Banks to Enter PE Business – The Reserve Bank of India is formulating guidelines that would allow government owned banks get into the private equity (PE) business. The announcement of the guidelines is expected by the end of the current financial year. At present, banks are allowed to take direct equity exposure up to 20 per cent of their net worth. The indirect exposure to capital market too has a similar cap. Therefore, banks can invest up to 40 per cent of net worth in the capital market. Many Indian public sector banks are now looking at private equity arena as part of their attempt to become conglomerates with presence across segments. (Business Standard)
Further Rates Cuts Expected Post Pranab- Bank Meet – Finance Minister Pranab Mukherjee’s meeting with public sector bank chiefs Monday will review their benchmark prime lending rates (BPLR) and interest rates on loans for automobiles, homes, small and medium enterprises (SMEs) and non-banking finance companies (NBFCs). Government has hinted towards further reductions in interest rates next month, before the announcement of elections. According to the banks, the cost of funds is still high, even though it has been falling through successive rate cuts by the central bank in 2008. Mukherjee is also scheduled to discuss the impact of the stimulus package and the utilisation of refinance to National Housing Bank (Rs 5,000 crore) and the small industries lender Sidbi (Rs 9,000 crore). (Business Standard)
IFC, VenturEast, BYST Launch Fund to Support Young Entrepreneurs – IFC, private equity fund manager VenturEast, and Bharatiya Yuva Shakti Trust (BYST) have instituted a Fund to provide financing and mentoring to young Indian entrepreneurs who have limited resources. With an initial support of $700,000 from IFC, VenturEast has raised $2 million from other institutions including Small Industries and Development Bank of India (SIDBI) and individual investors. The Fund is targeting $5 million and would be managed by VenturEast. (Business Standard)
Elecon Defers Overseas Acquisition Plans – Elecon Engineering Company Ltd has postponed its plans to acquire an overseas company owing to adverse economic conditions. The Vallabh Vidyanagar based engineering company was planning to acquire engineering firms in Western Europe and USA. The company was also in talks with few other companies for the same. Elecon was looking at acquiring a mid sized company with a turnover of Rs. 400 crore in Western Europe or USA. The company has now made investment in other projects and wants to ensure that the development of those projects is not hampered. (Business Standard)
Tata Capital to Raise Rs 500 Crore Through NCDs – Tata group’s non banking finance company (NBFC), Tata Capital is planning to raise at least Rs 500 crore through a public issue of secured non-convertible debentures (NCDs) to fund its expansion plans. The NCD comes with an option to retain oversubscription of an additional Rs 1,000 crore. The issue opens on February 2 and closes on February 24. Citigroup Global Markets India, ICICI Securities and DSP Merrill Lynch are the lead managers to the issue. Tata Capital has an asset base of Rs 6,828 crore as on September, 2008, up from Rs 3,329 crore in March 2008. The NBFC has come out with a small issue because the company first wants to test the market as this is the first retail bond issue in the past two-three years. (Business Standard)
Lakshmi Vilas Bank to Raise Rs 140 Crore – Karur based Lakshmi Vilas Bank (LVB) is planning to raise Rs 140 crore to strengthen its tier-II capital by March. The bank also plans to open 23 branches over the next 10 months. the bank presently has 251 branches. The new products, including three savings products and two current accounts, would help the bank’s increase its share of current and saving accounts in the total business to 23 per cent from 17 per cent. The bank has already spent Rs 15 crore on technology up gradation and would spend another Rs 6 crore towards this. (Business Standard)
Cosmo Films to Acquire GBC Commercial Printing Finishing Business – Cosmo films ltd. has announced that it will acquire the GBC Commercial Print Finishing business from ACCO Brands Corporation USA. The acquisition is subject to conditions precedent to closing including regulatory approvals. The deal is expected to close in the second quarter of 2009. GBC Commercial Print provides thermal lamination films and equipment in Europe, North America, Japan and the Pacific Rim. GBC has revenues of approximately $100 million. Cosmo Films, besides manufacturing thermal lamination films in India, manufactures biaxially oriented polypropylene (BOPP).
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