News Roundup: RIL to raise over $1B through export credit

20 February, 2014

Mukesh Ambani-promoted Reliance Industries (RIL) is in talks with four or five export credit agencies (ECA) to raise over $1 billion (Rs 6,220 crore) in the next four months. This is a part of the company’s plan to raise $13 billion (Rs 80,625 crore) debt to fund expansion of its petrochemical production capacity and gasification project for its refining facilities to improve margins. In the past two years the company has already tied up over $10 billion of foreign currency financing for this purpose. After tying up all its ECA facilities with another 4-5 ECA’s for an additional amount of $1 billion, RIL will have the largest number of ECA relationships globally. (Business Standard)

IIT-Madras alumni network to raise Rs 100Cr: The alumni network of Indian Institute of Technology (IIT) Madras is planning to raise Rs 100 crore ($16 million) this year for various purposes, including funding innovations and start-ups of IITians. It is evaluating a business plan to set up a development office in the US for the proposed fund raising. The network formally launched an innovation fund of $600,000 (Rs 37,211,50 crore) last year, one-fifth of which has been invested in seven-to-eight start-up firms as seed funding. This year, the fund is expected to have about $1 million (Rs 6 Crore) to expand. The company plans to raise Rs 100 crore this year – Rs 70 crore ($11 million) from the US and the rest from India. Part of this would go to the innovation fund, while the rest would go to various other projects including research, entrepreneurship development, sustainability initiatives etc,” said R Nagarajan, dean of international and alumni relations and professor, department of chemical engineering. (Business Standard)

Axis MF plans to buy ING Investment schemes: Axis Mutual Fund is set to acquire the assets of ING Investment Management, a joint venture between Dutch financial services group ING, realtor Rajan Raheja and Kirti Equities. A source familiar with the matter said Axis had offered to buy ING Investment Management’s schemes for Rs 20-30 crore ($3-4 million). Once the deal formalized, it will add about Rs 1,000 crore ($161 million) to Axis’s assets under management (AUM) of about Rs 14,700 crore ($2,370 million), as on December 31. There has been a handshake,” said a person familiar with the talks, without specifying whether all the three owners had signed. While ING owns 47.25% in ING Investment Management, Raheja’s Hathway Investments holds 39.75% and Kirti Equities owns 13%. (Business Standard)

WestBridge, Sequoia eyeing bumper returns from Vasan: WestBridge Capital, a $1-billion (Rs 6,202 crore) India-focused private and public equity fund, along with Sequoia India, is eyeing a blockbuster exit of at least 5x (five times returns) on their investment of a little over Rs 200 crore ($32 million) in Chennai-based Vasan Healthcare, which runs a chain of eye-care and dental-care clinics. In addition to WestBridge and Sequoia, Singapore government-backed GIC Investment is another private equity investor that had committed $100 million (Rs 620 crore) during mid-2012 and is unlikely to exit in the current round. WestBridge and Sequoia together have committed around $50 million (NR 310 crore) over three rounds into Vasan. (Business Standard)

For Jungle Ventures, less is more: Singapore-based Jungle Ventures’ efforts to connect start-ups in Asia with investors and technology seem to be paying off. The fund, which raised $15 million (Rs 93 crore) in 2012, is in the process of closing a top-up. The fund’s founders, however, declined to disclose the size of the top-up. Jungle, started by Indian-origin entrepreneurs Amit Anand and Anurag Srivastava, believes the future of global entrepreneurship depends on smart, connected capital. Anand and Srivastava started the fund in 2011 and made initial investments in three firms through their own investments. In 2012, they raised their first fund. It seems the fund’s approach has managed to work well. In the past three years, the fund has exited from three companies, making 4-5x returns. (Business Standard)

Kolkata-based Bandhan plans to raise Rs 160 crore from IFC. SIDBI-backed Bandhan Financial Services Pvt. Ltd., India’s largest microfinance provider in terms of loan disbursements, is planning to raise around Rs 160 crore ($26 million) from International Finance Corporation (IFC). IFC’s debt investment will help Bandhan diversify its sources of funding thereby providing comfort to potential lenders and investors. Since the debt would be subordinated, it would also enable Bandhan to meet its regulatory capital requirements. Bandhan operates mainly in rural areas across states including some of the eastern and north eastern states. It provides formal credit services to low income households. (Business Standard)

Kedaara, TA Associates eye 49% in Cremica: Private equity majors Kedaara Capital and TA Associates are in the fray to buy up to 49% stake in Cremica, a Punjab-based maker of biscuits and bakery products, in a deal estimated at about Rs 300 crore ($48 million). Cremica, owner of the Mrs Bector’s brand, would see existing investor Motilal Oswal Private Equity and one of the promoter shareholders offloading shares following a family settlement. Cremica Group, founded by Rajni Bector as a backyard enterprise 35 years ago, till recently was controlled by three siblings – Anoop, Akshay and Ajay Bector – with equal shareholding. As part of a recent settlement, Anoop Bector will take charge of the biscuits and bakery unit, while Akshay Bector will helm the condiments business. (Times of India)

Muthoot promoters may sell stake once RBI clears bank licence: Promoters of Muthoot Finance may dilute their stake once their application for bank licence is cleared by the Reserve Bank of India, a senior executive of the gold loan company said today. George M Alexander, senior vice president of Muthoot also said they expect some decision on the licence issue by the end of February from the RBI and accordingly the company will approach SEBI for necessary approvals. Currently, promoters of Muthoot Finance hold 80.12 % stake in the company. (Financial Express)

Magma Fincorp plans to raise debt from IFC: IFC’s proposed investment in Magma Fincorp Limited (Magma), one of the top 20 NBFCs in India, of up to Rs 215 crore (around $35 million equivalent) through the subscription of its Tier II Subordinated Unsecured Non-Convertible Debentures. The project is intended to provide support to the company by strengthening its capital base and by helping it grow its asset base in the next few years, said IFC. The Company plans to utilise the funds raised through issuance of NCDs to augment its capital adequacy, continue to focus on penetration in low income states, especially targeting customers with lower incomes by financing smaller assets with smaller ticket sizes. (Business Standard) 

Au Financiers plans to raise funds from IFC: Warburg Pincus, Motilal Oswal Private Equity and Chrys Capital, backed non-banking finance company Au Financiers (India) Ltd planning to raise around $30 million from its existing investor International Finance Corporation (IFC). The fund raising will be through Non-Convertible Debentures (NCD). The investment is expected to reach additional low income customers between FY14-17 and will help funding requirements of the NBFC from a diversified source. Besides, IFC’s debt support will help the Company attract other FIIs as takers of its corporate debt, said IFC. (Business Standard)

Courtesy: VCCEdge


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News Roundup: RIL to raise over $1B through export credit

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