Tuesday, March 13, 2007

Havell's acquire German lighting firm Sylvania for $300 mn

Havell's India has acquired Germany’s SLI Sylvania's lighting business for $300 mn (about Rs. 1350 crores) in an all-cash deal, from a group of private equity firms. This is the biggest overseas takeover by an Indian electrical equipment manufacturer in the lighting business.

The acquisition was made through Havell’s Dutch subsidiary, Havell's Netherlands BV and would be funded through a mix of debt and internal accruals. The combined revenues are expected to be $1 bn. Deutsche Bank was the advisor to Havell’s on the transaction and Barclays Capital would provide the financing to the deal.

SLI Sylvania operates in key geographies of Europe, Latin America and Africa through 10 manufacturing facilities. The company would get access to all of Sylvania's markets across the world except Mexico, US, Australia and New Zealand where the business is owned by German lighting firm Osram, one of the largest lamp manufacturers in the world. Sylvania Osram had sold its lighting business to a consortium of three private equity funds comprising Subros, JP Morgan and DDG Capital and Havell's has acquired the business from this consortium.

Read more on this in Moneycontrol.com.
Related Post:
Havell’s may buy UK lighting company for Rs. 1000 crores

Rahul Bajaj buys into privately-held Bajaj holding company Bachhraj

Rahul Bajaj has acquired stake in Bachhraj and Company by buying out minority shareholders SK Birla, CK Birla and Yash Birla. Bachhraj is a privately-held holding company and is a step-down subsidiary of the main holding firm of the Bajaj Group, Bajaj Sevashram. Bachhraj holds a 24.54% stake in Bajaj Hindustan, the sugar company controlled by Shishir Bajaj. Bachhraj also has equity holdings in Bajaj Auto and Mukand. At Monday’s closing market price of the three listed companies, the direct equity held by Bachhraj in these companies would value its holding at a staggering Rs. 1093 crores. The shares have been purchased from the Birlas over the last one year by the Rahul Bajaj group.

This is significant in the wake of the recent spat that has arisen between Rahul Bajaj and Kushagra Bajaj, son of Rahul Bajaj’s younger brother Shishir Bajaj. Kushagra Bajaj has accused his uncle Rahul of trying to wrest control of the Bajaj group of companies belonging to the Shishir Bajaj faction. At the heart of the feud lies the various crossholdings of the extended Bajaj family in the numerous Bajaj group of companies.

Read the articles in The Economic Times 1 and 2.

PE firms may not support Ranbaxy’s bid for Merck’s generics business

In a major setback to Ranbaxy Laboratories’ bid attempt for Merck’s generics business unit, private equity firms have stated that they do not want fund Ranbaxy's offer as the Indian drug maker does not want to give them an equity stake. Ranbaxy may offer equity only in a special purpose vehicle rather than in itself if it wins the bid. First round non-binding offers for the business, which is expected to fetch at least €4 bn ($5.2 bn), are due by Monday. Iceland's Actavis and Ranbaxy have both said they want to acquire the business.

Meanwhile, the other Indian pharma companies in the race for the Merck bid, Dr. Reddy’s and Cipla, have opted out. Several global majors like Novartis, Teva, Actavis and private equity group Carlyle are said to be interested in the bidding.

Article in Reuters.com and DNA Money.
Related Posts:
Ranbaxy Laboratories to bid for Merck's generic drug business
Ranbaxy Labs to set up SPV for Merck Generics bid

Rain Commodities enters bidding war for GLC Carbon; raises bid price

Rain Commodities has entered into a bidding war for the acquisition of GLC Carbon USA and has raised its bidding price from the earlier C$11.60 per share to C$13.25. The acquisition is being effected through Rain Commodities’ wholly-owned subsidiary, Rain Commodities USA Inc.

This raises the effective price for the acquisition of 73.56% in GLC from Rs. 1624 crores to Rs. 1873 crores. The hike in price is in view of the competitive bid for GLC made by Oxbow Carbon and Minerals Holdings, Inc, which offered a price of C$ 13.00 per share.

Under the amended agreement, the termination fee has also been increased from C$ 14.5 mn to C$ 17 mn. The termination fee will be payable to Rain Commodities by the GLC Income Fund, the holding company of GLC Carbon, in case a third party shows interest in buying GLC Carbon and the deal turns in favour of the third party.

The acquisition of GLC Carbon will make Rain Commodities the world's largest producer of Calcined Petroleum Coke (CPC) with a total capacity of 2.43 mn tonnes per annum. The acquisition would be funded by a mix of debt, internal accruals and funds raised through QIP. Rain Commodities is also planning to merge group company, Rain Calcining, which is into CPC production, with itself to achieve business synergies.

Read the article in The Economic Times.
Related Posts:
Rain Commodities to buy Canadian carbon company for Rs. 1624 crores
Rain Calcining to merge with Rain Commodities

Malaysian government investment arm acquires 9% in IDFC for Rs. 848 crores

Khazanah Nasional Berhad has acquired 8.97% stake in Infrastructure Development Finance Company (IDFC), a specialized financial intermediary for infrastructure, for Rs. 848.16 crores. Khazanah Nasional is the investment holding arm of the Malaysian Government entrusted to manage the commercial assets held by the Government and to undertake strategic investments. Khazanah was incorporated in 1993 as a public limited company and commenced operations a year later.

Khazanah Nasional Berhad, through Sipadan Investments, acquired around 100.9 mn shares at a price of Rs. 84 each from UBS Securities Asia who sold the shares on behalf of Mauritius based Swiss Finance Corporation. As per the latest shareholding data available on the stock exchanges, Swiss Finance Corporation previously held 101.3 crore shares representing 9% stake in IDFC. Other foreign investors, who hold significant stakes in IDFC, are Indivest Private (3.79%), Nikko Cordial Corporation (2.49%), Morgan Stanley (3.62%), Goldman Sachs (3.73%) and Barclays Capital (4.96%).

Read the article in The Economic Times article.

Domestic investment bank Allegro ties up with UK-based Close Brothers for cross-border opportunities

While the JM Financial-Morgan Stanley JV unravels, another one seems to be in the making. Allegro Capital Advisors, a domestic investment bank with a pan-India presence has tied up with UK-based investment banking firm Close Brothers for cross-border investment banking partnerships in South East Asia.

The alliance would enable Allegro to offer international investment banking services and deliver a global platform of M&A opportunities to Indian businesses. The firm claims to be already sitting on a number of cross border acquisition mandates from Indian corporates.

Close Brothers focus on the mid-market corporate segment. It is UK’s largest listed investment bank with a network of 450 investment banking professionals across 36 offices located in 20 countries.

Read The Economic Times article.