Tuesday, December 19, 2006

Ambani goes for the kill, to buy out Ruia's stake as well

Finally, Anil Ambani has made his intentions absolutely clear. Reliance Communications will buy out Hutch-Essar in its entirety. Nimesh Kampani, representing the Ruias is believed to have held meetings with Anil Ambani. Various parties as interested in buying out Hutchison’s stake in Hutch-Essar are doing the rounds of investment circles. These include Ruias themselves raising debt from banks and buying Hutch’s stake in the JV. Bharti’s Mittals are also heard to be interested in buying out the company. Even the name of the Tatas has been mentioned. Maxis, the Malaysian telecom company, is also set to bid for Hutch-Essar. The Ruias stand to gain around $4-5 bn if they sell their stake to Reliance Communications. Ruias are being advised by Morgan Stanley and Goldman Sachs. UBS is advising Ambani on the deal. Buyout funds like Blackstone, Texas Pacific, Carlyle and Kohlberg Kravis Roberts, among others, are supporting Reliance to structure the financing. With about $10 billion through cash to buy equity and around $2-4 billion as debt from major foreign banks, Reliance seems to be the frontrunner in getting the Hutch-Essar telecom business.

Read the article from Business Standard.

Lightspeed invests $29.5m in Bangalore net companies

Venture capital investors are making a beeline for India. Following Texas Pacific Group Ventures and Sherpalo, Silicon Valley-based venture capital fund Lightspeed Venture Partners, with $1.5 bn of assets under management, has invested in two Indian companies – Mercantila and TutorVista – both based in Bangalore.

Mercantila, a collection of hundreds of online specialty stores serving the US and Canadian markets, has received funding upto $22.5 mn, while online tutoring and test preparation company TutorVista has received $7 mn.

Lightspeed has recently raised a $475 mn fund, one-third of which would be invested in assets outside the US. Israel, China and India would be major recipients of this allocation. India itself may see investments in the range of $50-100 mn. Lightspeed is keen to make a mark in the growing Indian market and intends to establish an Indian office in the coming 12 months.

Read more in The Economic Times, Red Herring and ContentSutra.com.

Matrix Partners Invests In Stealth Start-up Four Interactive

Matrix Partners is making investments and news by the day. After investing $7 mn in Seventymm.com, an online DVD rental company and $5.5 mn in Moods Hospitality, owner of the Yo! China brand of Chinese food outlets, the $ 150 mn cross-sector fund has bought an undisclosed stake in Bangalore-based stealth mode start-up Four Interactive. As per the company website, Four Interactive is “building easy to use services which lie at the intersection of mobile, content and web”. Four Interactive has been founded by ex-Microsoft execs Kiran Konduri and Shriram Adukoorie. Kiran Konduri was the founder of Zephyr Software, later acquired by Infospace. Shriram Adukoorie is the former country head for MSN India and South Asia.

Makemytrip.com gets $13 mn from VC investors

Travel portal Makemytrip.com has raised $13 mn in a second round of funding. Helion Ventures, Sierra Ventures and existing investor SAIF Partners are the investors. The company has a projected turnover of Rs. 600 crores ($130 mn) for the current financial year, up from Rs. 200 crores ($42 mn) last year. Travel portals have been seeing a lot of money coming in of late. Recently, Travelguru.com raised $15 million from Battery Ventures and Sequoia Capital India. Cleartrip.com has also reportedly raised $8 million from DAG Ventures and Sherpalo Ventures.

Read ContentSutra.com for more.

S P Apparels to list in six months

Textiles seem to be the stocks to watch out for. SP Apparels earlier had acquired a private equity placement of $8 mn (approx. Rs. 36 crores) from global insurance major New York Life Insurance’s investment arm, New York Life Investment Management, from its NYLIM India Fund. The Rs. 200-crore company is now planning to hit the capital markets. SBI Capital Markets and IL&FS InvestSmart are the advisors to the issue, which may come out within the next six months. The company intends to raise around $82 mn (Rs. 370 crores) from the listing and divest 25% stake to the public, having previously offload around 10.71% stake to NYLIM India Fund. S P Apparels is expanding rapidly, having earlier acquired the domestic men's brand Crocodile in April last. It has also chalked up Rs. 370-crore, Phase-II expansion programme, covering its backward linkages in spinning, knitting, wet-processing, garmenting and retailing, including the cost of acquisition of the brand. Presently, the company exports 90% of its production; clientele includes major global garment retailers such as Mothercare, Tesco, Disney Stores, H&M, Benetton and Dunnes Stores. It is consistently posting 25-30% growth in the last three years has achieved a sales turnover of Rs 200 crore during 2005-06. Its sales during the half-yearly period ended September 2006 stood at Rs 120 crore.

Read article from Moneycontrol.com for more details.