Wednesday, March 21, 2007

Chennai-based IT firm Quintegra acquires firms in US, Singapore

Chennai-based listed software firm Quintegra Solutions has acquired US-based ValleyUS and Jadelite Technologies of Singapore for a total consideration of $ 10.5 mn (Rs. 46.50 crores). ValleyUS cost $9.5 mn, while the Singapore firm $1 mn.

ValleyUS is focused on domains like client-server, legacy, CRM and e-commerce. It has partnership with big five IT consulting firms in the Silicon Valley. Its major client is publishing house CTB McGraw Hill. Others are EBay, Wal-Mart, E-trade, Wells Fargo Bank, Yahoo, Google and BEA Systems. The acquisition of JadeLite, which has award-winning ERP for educational sector, is expected to improve Quintegra’s market share in the education and training management software.

Quintegra had raised a loan of $5 mn from State Bank of India for part funding the takeover of ValleyUS. The balance amount is to be paid on an earn-out model over a period linked to the firm achieving certain milestones. The takeovers will increase his people strength to 600 from the current 400.

The US market accounts for bulk of company’s revenues and the takeover of ValleyUS has synergies to strengthen its presence there. The US firm had clocked revenues of Rs. 53 crores ($12 mn) for the year ended March 31, 2006 and it is projected to achieve Rs. 80 crores ($18 mn) in 2007-08. The Singapore firm is expected to achieve revenues of Rs. 80 to Rs. 90 crores in the next three years.

Read the article in The Economic Times.

SEBI eases listing agreement for debenture issues

The Securities and Exchange Board of India (SEBI) today has relaxed listing agreement for debentures. It has allowed companies issuing debentures on private placement, to submit their unaudited half-yearly results to the stock exchanges, instead of quarterly basis.

The regulator seems to be easing the guidelines with an objective to encourage more companies to tap the debenture market, which has been lying low for some time now. With the amendment, the debenture issuer companies would now be submitting unaudited half yearly results instead of unaudited quarterly results.

However, the half-yearly accounts would be subject to a limited review, which has to be done by the statutory auditors of the company. The SEBI has also made changes to the format which is to be used for reporting of the limited review.

Read the article in Business Standard.

Raymond James to buy out Indian partner ASK Investment Financial Consultants from ASK-Raymond James JV

US brokerage Raymond James Financial, Inc. may buy out the stake of its Indian partner, ASK Investment Financial Consultants. Competition in India's investment banking market has heated up dramatically, and foreign securities houses are now scrapping joint ventures to chase deals by themselves.

Last month, Morgan Stanley said it would spend a net $425 mn to split from its Indian partner, JM Financial. Merrill Lynch agreed to pay $500 mn to lift its stake in its DSP Merrill Lynch joint venture to 90% from 40% in December 2005. Goldman Sachs announced plans last year to set up its own Indian investment banking and securities business after selling its stakes in two joint ventures to partner Kotak Mahindra Bank.

Read The Economic Times article.

Nakheel, DLF form JV for infrastructure development projects worth $12 bn

Delhi-based real estate giant DLF is reportedly forming a joint venture with Nakheel, the largest property development company in the United Arab Emirates. The JV is being formed for mega infrastructure development projects at an estimated cost of $10-12 bn.

Each project, one near the National Capital Region and the other in Maharashtra, along the coastal region, would be spread over 20,000 acres, and would involve the development of industrial infrastructure and township components, including residential, commercial, retail and recreational centres. Each partner would bring around $3 bn to the table while the remaining would be financed through debt.

Nakheel is behind some of the most iconic projects in the Middle East such as The Palm, The Dubai World and Dubai Waterfront. Nakheel currently has 17 major projects, worth more than $30 bn under development.

Read more in The Economic Times article.

BCCL to buy 3.5% in Refex Refrigerants

The Economic Times reports that Bennett, Coleman & Company Limited (BCCL) will pick up a stake of around 3.5% in Chennai-based Refex Refrigerants, for an undisclosed sum. Refex is engaged in refilling-ozone friendly refrigerants and marketing refrigerant products in India. Refex is the only player in the country which has the distinction of refilling and marketing hydro-fluoro-carbons, which is a non-ozone depleting, environmentally safe refrigerant developed to replace chlorofluorocarbons in several air conditioning and refrigeration applications.

ICICI Ventures invests Rs. 82 crores in engineering firm Electrotherm

ICICI Ventures has invested Rs. 82 crores in engineering company Electrotherm India Limited, for an undisclosed stake. The investment will part-fund the second phase of Electrotherm’s expansion plans of Rs. 400 crores. In addition to the investment made by ICICI Ventures, the promoters would bring in Rs. 58 crores to meet the equity portion. Terms loans worth Rs. 200 crores and internal accruals of Rs. 60 crores would meet the balance funding requirements of the proposed expansion plans. The term loans have been sanctioned and disbursed and the Company has already invested Rs. 300 crores out of the total planned expenditure of Rs. 400 crores. KPMG Corporate Finance was the sole advisor for the transaction.

Electrotherm is an engineering and manufacturing company with major strength in power electronics. Leveraging its core strength in power electronics, the Company through its in house R&D facilities developed a battery-operated scooter, which has been a commercial success in Gujarat, and has also seen good response from other customers as well.

For more on Electrotherm, read the article on Equitybulls.com.

Essar Shipping share buyback fails; company to remain listed

Essar Shipping has failed in its buyback of shares and subsequent de-listing from the bourses. As a result, the company has decided to continue being listed on the stock exchanges. The Essar Shipping share buyback, being facilitated through a reverse book-building process, closed on March 16. The company has notified the exchanges that the buyback offer for its de-listing did not get sufficient bids.

The company had fixed the floor price for the buyback offer at Rs. 31.62. Maximum number of bids was believed to have been received at a price of Rs. 50-51 per share, while 15-20 mn bids were even received at a price of Rs. 75 per share. However, the total number of bids was not adequate to move ahead with the delisting process.

Meanwhile, the delisting process of another two group companies, Essar Oil and Essar Steel has been progressing as planned. The ballot papers have been sent to the shareholders and after they are returned, a public notice would be made and delisting would commence through RRB, after market regulator SEBI fixes the floor price for both the stocks.

Read The Economic Times article.
Related Post:
Essar Group to de-list Essar Steel and Essar Oil

Credit Suisse launches Indian brokerage operations

Zurich-based global bank Credit Suisse has launched of its securities brokerage operations in India. Credit Suisse holds a broker dealer license in the Bombay Stock Exchange and National Stock Exchange and will focus on equity sales and trading and research in India. Initially, the India operations will be run by about 40 people with addition of 20-30 more over the year.

The company would later bring the full range of its products including asset management and private banking as regulations for financial services in India open up. The company would also offer investment banking services in new equity issuance and merger and acquisition activities at a later stage.

Credit Suisse acted as the lead financial adviser to the UK-based steel major Corus in its acquisition by Tata Steel. Credit Suisse is also leading the provision of financing Tata Steel in the deal.

Read The Economic Times article.

AIG Capital India acquires housing fiancé company Weizmann Homes

AIG Capital India will acquire Bangalore-based housing finance company Weizmann Homes Limited. AIG Capital India is the wholly-owned Indian subsidiary of US-based financial services giant American International Group, Inc. the company is being bought from Weizmann Limited, Federal Bank, Asian Investment & Finance Corporation Limited and other minority shareholders. The transaction is expected to close in April 2007.

Weizmann Homes is a 12-year-old, Bangalore-based housing finance company, with a branch network across 33 cities in India.

This is the second acquisition this year by AIG Capital India in the Indian retail finance industry. Earlier, it had earlier acquired a controlling stake in Chennai-based Vivek Hire Purchase and Leasing.

For more, read the press release on Moneycontrol.com.