Wednesday, January 24, 2007

Lehman Brothers gets government approval to trade in G-Secs

Lehman Brothers Securities has obtained permission from the Foreign Investment Promotion Board (FIPB) to trade in government securities. The financial sector giant plans to invest Rs 225 crore here through a number of downstream subsidiaries, which will directly trade in securities. The downstream subsidiaries of Lehman Brothers will also take up underwriting, merchant banking and other financial services, apart from functioning as primary dealerships (PDs) for trading in government securities.

Read The Economic Times article.

IFC to invest $600 mn this year

International Finance Corporation (IFC), the private equity arm of the World Bank, intends to invest around $300 mn for the year ending June 30, 2007, reports The Economic Times. For the year ended June 30, 2006 IFC had invested $ 410 mn. The financial sector accounted for the largest chunk of IFC’s exposure in the first half of its financial year (July to December). Over 70% of IFC’s exposure will be through the debt route and the rest through equity stakes in Indian companies. The biggest chunk of $150 mn went into ICICI Bank’s Tier-II bond issue announced in October. Another $100 mn was invested in HDFC Bank’s Tier-II bond issue. Infrastructure is one of the priority areas for IFC, which is now keen on funding ultra-mega power projects. Healthcare is another focus area of the corporation.

CLSA buys 10.92% stake in Sanghvi Movers

Business Standard reports that foreign fund CLSA Capital Partners has bought 10.92% stake in mid-cap Sanghvi Movers, a flagship of the Sanghvi Group, one of Asia’s largest crane-hiring companies. The board of Sanghvi Movers has allotted 8.8 lakh equity shares of the company at Rs. 825 a share, aggregating to Rs 72.6 crores to Goldpeak, a subsidiary of Aria Investment Partners III, which is one of CLSA Capital Partners’ funds, on a preferential basis.

23 foreign investment plans cleared by FIPB; plans included those of Reliance Communications, Lehman Brothers

The Foreign Investment Promotion Board (FIPB) approved foreign investments worth Rs. 5910.66 crores on Tuesday, reports The Economic Times. Of this amount, the major chunk is expected to flow into Reliance Communications by way FII investments worth Rs. 5400 crores. The company will raise this money through ADRs and GDRs worth $1.2 bn. The government also approved US investment bank Lehman Brothers' planned investment of Rs. 225 crores in its Indian arm. Velcan Energy, a French power generation company has also got an approval to invest Rs. 200 crores in the Indian renewable energy sector. The company will now convert its operating company in India to an operating-cum-holding company. The FIPB has also given permission to Mauritius based Horse-Shoe Capital to invest Rs. 45 crores to make downstream investments in companies engaged in providing telecommunication infrastructure. The other approvals include a nod to Hong Kong-based Haier International for marketing and distribution of Haier brand mobile phones. The company plans to set up a joint venture with a foreign equity of 51% for single-brand retail. The government has also cleared the application of US-based Bloomingdale International, which will allow the company to set up a chain of five-star and three-star hotels in the country. The company will invest Rs. 8.6 crores as per the application. Singapore-based Sincere Watch has also got an approval to set up a wholly-owned subsidiary to set up duty free shops at airports, seaports and SEZs. Bank of Muscat has also got a go ahead from the board to invest Rs. 10.92 crores in an NBFC in India (See Related Post). Other approvals include Delta Plus’ plans to set up a JV with 90% foreign equity for warehousing and export activity. Deutsche Post international has been permitted to raise its stake from 49% to 51% in DHL Danzas, which is engaged in carrying on business of transportation, air freight and ocean freight.

Apollo to launch $2bn Indian real estate fund

Apollo, the US private equity group, is joining forces with SUN Group, an Indian investment company, to launch India’s biggest-ever real estate fund. Apollo and SUN have together raised $630 mn of equity, which, with gearing, gives them $2 bn of spending power in the Indian market. The launch is the latest in a string of new vehicles aimed at the real estate market in India and US, Middle Eastern and local funds are looking to take advantage of India’s fast-growing GDP and perceived lack of good quality infrastructure. The SUN Group, owned mainly by the Khemka family, has a range of investments across India and the former USSR. The joint venture, SUN-Apollo India Real Estate Fund, has a remit to invest across the whole spectrum of residential and commercial property in the major Indian cities.

Read the FT Alphaville.com posting.

CVC International invests $33 mn in infrastructure company Indu Projects

Citigroup Venture Capital International, the private equity arm of Citigroup, has invested Rs. 150 crores ($33 mn) in Hyderabad-based infrastructure and real estate player Indu Projects Limited. Indu Projects has placed 9% equity at Rs. 1214 per share, and post-issue, the company’s equity stands at Rs. 13.69 crores while its total valuation stood at Rs. 1650 crores. DSP Merrill Lynch was the financial adviser to the transaction. The proceeds of the private placement are intended to improve the company's net worth and fund projects in the commercial and residential space that include construction of 28 mn sq. ft. of plinth area in Hyderabad, Bangalore, Pune, Coimbatore, Chennai and Nandyal (Andhra Pradesh). The company has over 30 mn sq. ft. of real estate development under way across the country.

Read the Business Standard and Moneycontrol.com article.
Related Post: IL&FS, Sabre Abraaj invest Rs. 125 crores into Ramky Infrastructure

Champagne Indage buys South Australia-based wine maker Tandou Wines

Indian wine company Champagne Indage is buying the wine business and winery of Tandou Wines of South Australia for an undisclosed amount. The winery has a capacity of 3 mn cases (27 mn litres) annually. Champagne Indage produces 8 mn litre wines annually. Both the companies have signed an agreement which will be finalized in seven days.

The Australian wine maker will be renamed after the acquisition, likely to be Indage Australia Limited. Champagne Indage plans to diversify into foods and confectionery business and has set up a subsidiary, Seabuckthorn Indage Limited (SIL), to meet this end. Champagne Indage will hold 52.63% equity in this company which currently markets the Leh Berry brand fruit nectar, and has plans to get into jams and fruit juices. The company is also talking to a couple of players for third party manufacturing of its biscuits and jams.

Read the Business Standard and The Times of India articles for more details.