Central Bank of India, one of the few government-controlled banks yet to tap the capital market, has filed its draft prospectus for an initial public offering with the capital markets regulator Sebi to raise close to Rs 1,000 crore.
The bank, which is planning to launch a public offering of eight crore shares, is likely to price its issue at close to Rs 110 per share. Central Bank, like other banks in the country, needs funds to bolster its capital base to feed rising demand in an economy which has recorded an average growth of 8% during the last four years.
The public offer will help the bank bolster its capital adequacy ratio now at 10.4%. The beefing up of its capital base will also aid the bank in fulfiling regulatory norms for banks with overseas operations.
Source: Economic Times
Thursday, May 24, 2007
ITC Hotels acquire 100 % stake in King maker Marketing Inc. (KMM)
ITC Ltd on Thursday said it has acquired the balance 49.02 per cent shareholding of King Maker Marketing Inc (KMM) for an undisclosed amount. After the said acquisition, KMM has become a wholly-owned subsidiary of ITC with effect from May 9, ITC said in a communique to the Bombay Stock Exchange. Earlier on November 6, ITC had consolidated its stake to 50.98 per cent, after which KMM became a subsidiary company of ITC. KMM is engaged in the business of distribution of tobacco products and all its brands are made exclusively by ITC.
Jain Irrigation to acquire an Israeli co.
The Indian agriculture conglomerate Jain Irrigation Systems is buying 50% of Israel's Na'an Dan Irrigation at a company valuation of NIS 140 million.
Sources in Israel's agriculture sector say that Na'an Dan preferred the Indian offer, even though Israeli company Netafim's offer was more attractive in many respects. The reason for rejection is believed to be that Netafim demanded a controlling share in the company, raising concerns that Netafim would take steps to integrate the management activities of the two companies, sending Na'an Dan's management home.
Source: Haaretz.com
Related News: Jain Irrigation to acquire US-based Aquarius Brands for $21.5 mn
Sources in Israel's agriculture sector say that Na'an Dan preferred the Indian offer, even though Israeli company Netafim's offer was more attractive in many respects. The reason for rejection is believed to be that Netafim demanded a controlling share in the company, raising concerns that Netafim would take steps to integrate the management activities of the two companies, sending Na'an Dan's management home.
Source: Haaretz.com
Related News: Jain Irrigation to acquire US-based Aquarius Brands for $21.5 mn
Restrictions on Realty VCs
The real estate sector has been on the radar of regulators for a while now. The fear of an asset bubble being formed due to increased interest in the sector, especially by the ever growing realty funds, has been sensed by one and all.
As per an article in the Business Standard, the government is reviewing norms for investments by foreign venture capital funds in real estate, after the Reserve Bank of India coming round to the view that such funding is helping create an asset bubble in the sector.
The government had recently clamped down on the use of external commercial borrowing by real estate companies in order to check capital inflow, which, it feels, is fuelling inflation in the country.
With stock market sentiments too turning against the sector, real estate developers were looking at private equity funds as their last hope. But that source too could suffer if the proposed clampdown on venture capital funds takes place.
Under current norms, foreign venture capitalists invest in real estate through private equity firms in the form of foreign direct investment.
While market regulator Securities & Exchange Board of India has cleared the decks for registration of such VCs, the Reserve Bank of India has opposed their operation and not allowed them to open foreign exchange accounts. If the Reserve Bank gives the green signal, such investments will be clubbed under institutional investments.
Read more
As per an article in the Business Standard, the government is reviewing norms for investments by foreign venture capital funds in real estate, after the Reserve Bank of India coming round to the view that such funding is helping create an asset bubble in the sector.
The government had recently clamped down on the use of external commercial borrowing by real estate companies in order to check capital inflow, which, it feels, is fuelling inflation in the country.
With stock market sentiments too turning against the sector, real estate developers were looking at private equity funds as their last hope. But that source too could suffer if the proposed clampdown on venture capital funds takes place.
Under current norms, foreign venture capitalists invest in real estate through private equity firms in the form of foreign direct investment.
While market regulator Securities & Exchange Board of India has cleared the decks for registration of such VCs, the Reserve Bank of India has opposed their operation and not allowed them to open foreign exchange accounts. If the Reserve Bank gives the green signal, such investments will be clubbed under institutional investments.
Read more
Whats up at Old Lane?
Old Lane is a New York based Hedge Fund with a $500 million India fund. The firm was set up by former Morgan Stanley executives Vikram Pandit, John Havens and Guru Ramakrishnan.
13 months into existence, Old Lane was bought by Citigroup for a reported sum of $800 million. Pandit now heads Citi’s alternative investment business, while Ramkarishnan, a co-founder, has taken over as the CEO. By next month around 40% of the India fund will be invested
Read more about Old Lane, its investments and its plans in the Mint
13 months into existence, Old Lane was bought by Citigroup for a reported sum of $800 million. Pandit now heads Citi’s alternative investment business, while Ramkarishnan, a co-founder, has taken over as the CEO. By next month around 40% of the India fund will be invested
Read more about Old Lane, its investments and its plans in the Mint
RBI to allow Temasek, Singapore Invt. arm to buy ICICI stake
The Reserve Bank of India (RBI) will allow Temasek and Government of Singapore Investment Corporation (GIC) to acquire 10% equity each in the country’s largest private sector lender ICICI Bank as a “one-off case”, as reported by Economic Times.
The regulator has taken a stand that this cannot be “quoted as a precedence” for the Singapore government’s investment arms and any other foreign investor to pick up stakes in other private sector banks, sources told ET. Even though the government has been in favour of allowing the Singapore entities to hold higher stakes in ICICI Bank, RBI had earlier said that Temasek and other investors associated with the Singapore government, like GIC and Monetary Authority of Singapore, were all ‘related entities’ and could together hold a maximum 10% stake.
The tussle between RBI and the Singapore government owes its origin to the Comprehensive Economic Co-operation Agreement between India and Singapore. The agreement says “...for investments into India’s capital markets, India shall regard GIC, Temasek and their investment vehicles as independent and unrelated legal entities, for the purpose of application of the Sebi legislation, including rules, regulations and guidelines governing investment limits on Foreign Institutional Investors...” Further, Annex 7 of the treaty says, “Each legal entity shall be allowed to purchase up to 10% or the prevailing threshold under these regulations, whichever is higher, of the issued capital of any company.” The Singapore investment arms were keen to participate in ICICI Bank’s issue in December ‘05. RBI had refused to make any exception for Temasek in the ownership guidelines for private banks, and had barred from further raising stake in the private bank.
The regulator has taken a stand that this cannot be “quoted as a precedence” for the Singapore government’s investment arms and any other foreign investor to pick up stakes in other private sector banks, sources told ET. Even though the government has been in favour of allowing the Singapore entities to hold higher stakes in ICICI Bank, RBI had earlier said that Temasek and other investors associated with the Singapore government, like GIC and Monetary Authority of Singapore, were all ‘related entities’ and could together hold a maximum 10% stake.
The tussle between RBI and the Singapore government owes its origin to the Comprehensive Economic Co-operation Agreement between India and Singapore. The agreement says “...for investments into India’s capital markets, India shall regard GIC, Temasek and their investment vehicles as independent and unrelated legal entities, for the purpose of application of the Sebi legislation, including rules, regulations and guidelines governing investment limits on Foreign Institutional Investors...” Further, Annex 7 of the treaty says, “Each legal entity shall be allowed to purchase up to 10% or the prevailing threshold under these regulations, whichever is higher, of the issued capital of any company.” The Singapore investment arms were keen to participate in ICICI Bank’s issue in December ‘05. RBI had refused to make any exception for Temasek in the ownership guidelines for private banks, and had barred from further raising stake in the private bank.
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