| he deal is the largest overseas buy in the IT space | ||||||||||||||||||||||||||||||||||||||||
| Wipro Ltd, the country’s third largest software exporter, today achieved the distinction of making the largest overseas acquisition in the information technology (IT) space when it announced the acquisition of US-based, Nasdaq-listed outsourcing firm Infocrossing for approximately $600 million (around Rs 2,430 crore) in an all-cash deal. | ||||||||||||||||||||||||||||||||||||||||
The acquisition will be conducted through a tender for all the outstanding shares of Infocrossing, followed by a merger of Infocrossing with a Wipro subsidiary. Institutional members have a majority holding (close to 10 per cent) in the company.
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| Wipro is making an open offer at $18.70 per share, which — if fully subscribed — will cost close to $600 million. Wipro currently has cash reserves of $750 million and expects to close this acquisition by December 2007. Read more in Business Standard | ||||||||||||||||||||||||||||||||||||||||
Tuesday, August 07, 2007
Wipro buys US firm for $600 mn
RIL's Maha Mumbai SEZ may get extension
The board of approvals (BoA) for special economic zones (SEZ) is likely to extend tomorrow the validity of in-principle clearance to Reliance Industries' Maha Mumbai SEZ under the new rules that limit its size to 5,000 hectares.
"The extension of validity has been under the new rules that limit the size of a SEZ to 5,000 hectares," a government official said. Reliance had earlier proposed Maha Mumbai SEZ over an area of 10,000 hectares and received in-principle approval for project in August last year.
The amendment to rules notified in March had reduced the validity of in-principle approval to one year from three years previously, but BoA was given the powers to extend the validity by two more years.
Besides the Maha Mumbai project, the BoA, headed by Commerce Secretary G K Pillai, will take up eight fresh proposals. These include five zones for in-principle nod and three for formal approvals. Of these, two relate to Infosys Technologies which wants to set up IT and ITES zones near Hyderabad. The biggest zone coming up for in-principle approval is by Ispat Industries, which wants to set up a 1,012 hectare multi-product SEZ in Maharashtra's Raigad district.
Read more in Business Standard
India is now 5th largest global steel producer
India has moved up two places in global ranking and is now the fifth largest producer of crude steel in the world with the revised figures for production in 2006 ahead of South Korea and Germany.
An expert committee set up by the union ministry of steel, which went into the issue of under-reporting of capacity and production data, has revised the production figures for crude steel in calendar year 2006 to 49.45 million tonne as against the earlier reported 44 million tonne, which put India in the seventh position among global steel producers.
The revised figures for crude steel production in 2006-07 is pegged at 50.71 million tonne and that of finished steel at 51.90 million tonne.
According to figures released by the International and Iron and Steel Institute (IISI) for 2006 released in January, South Korea ranked fifth with a crude steel capacity of 48.4 million tonne and Germany sixth with 47.2 million tonne. With the revised figures, India has pipped both South Korea and Germany.
Lower estimates of induction furnace and re-rolling sectors accounted for most of the under-reporting of crude steel data, which in turn affected semi-finished and re-rolling (long product) figures.
Consumption figures have also been revised. The revised data series for the last five years for consumption after adjustment due to double counting for finished steel (alloy and non-alloy) shows that during 2006-07, domestic steel consumption stood at 46.14 million tonne as compared to 41.43 million tonnes in 2005-06.
Finance ministry limits ECB inflows to $20mn
The finance ministry today released revised guidelines for external commercial borrowings (ECBs) limiting inflows from such borrowings into the country at $20 million, and for use only for foreign currency expenditure for permissible end-uses of ECB.
According to a release on the website of the finance minsitry, "borrowers raising ECBs more than $20 million shall park the proceeds overseas for use as foreign currency expenditure for permissible end-uses. The above modifications would be applicable to ECB exceeding $20 million per financial year both under the automatic route and under the approval route."
The release added that borrowers proposing to avail ECB up to $20 million for rupee expenditure for permissible end-uses would require prior approval of the Reserve Bank under the approval route. However, such funds shall be continued to be parked overseas until actual requirement in India.
"All other aspects of ECB policy such as $500 million limit per company per year under the automatic route, eligible borrower, recognised lender, average maturity period, all-in-cost ceiling, pre-payment, refinancing of existing ECB and reporting arrangements remain unchanged," the release added.
The release further said that the new conditions would not apply to borrowers who have already entered into loan agreements and obtained loan registration numbers from the Reserve Bank.
Zensar Tech bags 7 mn dlr insurance biz
MUMBAI: Zensar Technologies Ltd, an IT and BPO services provider, today said it has received a seven million dollar (over Rs 28.27 crore) insurance deal from a South African insurance company.
With this deal, Zensar's insurance business reaches the 10 million dollar mark, having won a three million dollar contract from a US mid-west-based provider of insurance products, and a million dollar initial contract for BPO service from a Latin American insurance client.
"We are delighted to take our business in the 'Insurance Vertical' to its 10 million dollar mark, with the acquisition of a new insurance account in South Africa," Zensar Technologies Deputy Chairman and Managing Director Ganesh Natarajan said in a communique to the Bombay Stock Exchange.
Read more in The Economic Times
ICICI Bank reduces deposit rates by 0.25-0.50%
MUMBAI: ICICI Bank on Tuesday reduced interest rates on deposits of value less than Rs 15 lakh by 25-50 basis points for select maturities upto two years, a day after the country's largest lender SBI reduced its deposit rates.
The revised interest rate for tenors 181-365 days will be 6.25 per cent per annum as against 6.50 per cent at present, ICICI Bank said in a release.
Similarly, the revised interest rate for tenors 366 days-upto 2 years excluding special deposit schemes will be 6.25 per cent as compared to 6.75 per cent, it said.
The new rates would be effective from August 9, it said adding the interest rates on special deposit schemes remained unchanged.
The revision comes barely a week after Reserve Bank hiked the amount of depositors' money commercial banks need to park with the central bank by half a percentage point.
Read more in The Economic Times
Quatrro gets foothold in US mortgage sector
NEW DELHI: In what could be another game-changer for the Indian business process outsourcing (BPO) industry, Raman Roy-founded Quatrro BPO Solutions, on Tuesday, announced the acquisition of mortgage loan processing operations and platform of USA-based Preferred Financial Group, Inc.
Post the acquisition, Quatrro would become the first BPO offering from an Indian company that pursues the onsite-offsite model - the business model that has found favour with the software services industry in recent times. "We will be acquiring the technology platform, the people and the origination business of the US partner and that would also enable us to provide end-to-end fulfillment services to mortgage lenders across the US," says Quatrro Promotor Raman Roy.
The acquisition will be closed through Quatrro Mortgage Solutions - a subsidiary of Quatrro BPO Solutions and will allow the Indian major to provide quality service at a price-point projected to be 30 per cent to 50 per cent lower than current processing costs in the United States.
“This coming together of two successful organizations with talented people and great business acumen is in line with our creating value by innovation strategy, which involves attracting and supporting entrepreneurial management teams by building high-end third party businesses in underserved and uncontested market spaces,” adds Roy.
Read more in The Economic Times
Subir Raha joins RP Group as director
NEW DELHI: Former high profile Chairman and Managing Director of ONGC Subir Raha, who took the oil exploratory firm to new heights, will join RP Group of companies as a director.
"I am extremely pleased and privileged to have the opportunity to take on this new role. This is an exciting time to join RP Group. The company is experiencing a tremendous amount of growth, and I am excited that I can help in making an impact," Raha has been quoted as saying in a release issued by RP Group.
As a director Raha will manage RP Group's domestic business and strategic partnerships in India, the release said.
"As we continue to spread across India, Raha will focus on building a strong sales and operations team, developing RP Group's strategic positioning and enhancing our relationships with industry and government," RP Group founder and chairman Kaustuv Ray said.
Raha had also served as the Chairman of Standing Conference Of Public Enterprises (SCOPE).
RP Group with a turnover of more than Rs 400 crore has diversified business interests, including agro foods and ceramics, It has established a strong presence in the services sector, offering a wide array of high quality serials and newscasts.
Anil Ambani takes over 12K cr Sasan Power
NEW DELHI: At last, the Anil Ambani-led Reliance Power Ltd has bagged the Rs 12,000 crore Sasan Power Project with an installed capacity of 4000 MW. The project would be set up in the Sidhi District of Madhya Pradesh. Power Minister Sushil Kumar Shinde transferred the shell company, Sasan Power Ltd to ADAG Chief Anil Ambani in the capital on Tuesday. This brings to an end a bitter corporate feud that unfolded after the Lanco group was initially selected as the lowest and preferred bidder to execute the Sasan Power Project. Following disqualification of Lanco, the second lowest bidder, Reliance Power Ltd matched the tariff to Rs 1.196 per unit. Sasan Power Project is the first ultra mega power project that was taken up for execution by the nodal agency, Power Finance Corporation (PFC). Now, the Reliance Power will execute six units of 660 MW each. The Power Purchase Agreement, Escrow and Hypothecation Agreements were signed between Anil Ambani’s Reliance Power and PFC. Letter of Intent (LoI) for this Project was issued to Reliance Power Ltd on August 1. |
Monday, August 06, 2007
Wal-Mart, Bharti to hold news conference
MUMBAI: Bharti Enterprises and Wal-Mart Stores Inc will hold a media conference in New Delhi at 3:30 pm on Monday, a spokeswoman for Wal-Mart said.
A senior official from Wal-Mart and the head of Bharti Retail Ltd, Rajan Mittal, will be present at the conference, she said.
NDTV Profit television said Bharti Enterprises chief Sunil Mittal said 8 joint stores had been finalised, with the first store formats to be cash-and-carry.
Earlier this year, Bharti and Wal-Mart agreed to form a joint venture for cash-and-carry stores and back-end operations in India.
KEC approves merger of RPG with self
MUMBAI: Power transmission equipment maker KEC International Ltd said on Monday its board had approved merger of group firms RPG Transmission Ltd and National Information Technologies Ltd, with itself.
KEC will issue four of its shares for every 9 shares held in RPG Transmission, and two shares for every 15 held in National Information Technologies, it said in a statement.
Everest Kanto plans $50 mln capex
MUMBAI: Everest Kanto Cylinder Ltd said on Monday it plans to spend about $50 million on expansion and modernisation.
The company would set up a unit to make compressed natural gas cylinders and expand its industrial and large cylinder facility, it said in a statement.
Credit woes hammer US stocks again; ADRs not spared
MUMBAI: US stocks ended sharply lower Friday, as credit worries resurfaced and jobless data dampened sentiment. According to government reports, Non-farm payrolls grew by a lower than expected 92,000 in July, the lowest level since February. The jobless rate was expected to remain at 4.5%. The unemployment rate rose to 4.6%, the highest since January, economists were expecting payroll growth of about 133,000, according to a survey conducted.
Credit fears were reignited as CEO of Bear Stearns said the bond market turmoil may be a worse predicament than the bursting of the Internet bubble in 2000. Shares of Bear Stearns plunged over 6%, dragging down other stocks in the financial and brokerage sectors aswell. Citigroup, the biggest US bank, lost 2.7%, Wells Fargo & Co, the second-largest US home lender, also declined.
Wachovia Corp, the fourth-largest US bank, dropped 4% after announcing one of its units was temporarily pulling the plug on home loans falling between prime and subprime quality, until market conditions improve. Worries about credit also hit credit card companies on the theory that consumers struggling with mortgage payments would also fall behind on credit card debt. American Express shares fell 5.6%, while MasterCard dropped 8%.
Read more in The Economic Times
Govt to fuel SBI's growth plans
NEW DELHI/MUMBAI: The government, which is now the dominant shareholder of the State Bank of India, is planning to provide capital to the bank. Capital infusion by the government to the country’s largest bank may well be called for considering the business needs of SBI over the next couple of years. The move will also give SBI more leeway in raising funds which is capped due to the law that prevents the owner (now the government) from diluting its stake below 55%.
Government officials said the Centre would provide assistance to the bank to ensure that its business growth is not hampered. Assuming that the government infuses Rs 10,000 crore and if this is leveraged to build a portfolio by an additional Rs 1,00,000 crore, the resulting dividends and the tax on increased profits will make up for the government’s capital costs. Even at a 1% return on assets, the government could recover a significant amount from the bank, sources said.
Read more in The Economic Times
Key indices make slight recovery
MUMBAI: Key indices were weak but off early low as selling pressure eased a bit. The market started the week sharply lower as weakness in stocks overseas weighed. Realty, capital goods stocks were worst hit.
“The undercurrent is weak. Sensex has support at 14700 and Nifty at 4280. If these levels are violated, the fall could be sharper,” said Suresh Kumar Iyer, technical analyst at Asit C Mehta Investment Interrmediates.
Iyer advises traders to go short and exit longs and warns longer-term investors to stay away from the market, as he expects further correction.
At 11:10 AM, National Stock Exchange's Nifty was down 92 points or 2.4% at 4309.25, recovering from a low of 4267.15.
Bombay Stock Exchange's Sensex was at 14836.69, lower by 301 points or 1.9%from the previous close, but off the low of 14705.58 made earlier.
Read more in The Economic Times
Intermediate correction to continue
| The current chart projections suggest that the Nifty could drop till 4075-4100 points. |
| Another massive sell-off in mid-week meant that the broad market lost more ground but there was a partial recovery on Friday. The Sensex was down a nominal 0.65 per cent closing at 15,138 points while the Nifty lost about 0.98 per cent to close at 4,401 points. |
| The Defty lost 0.68 as the rupee gained again, after the RBI’s latest monetary policy was released. The Nifty Junior was down 0.61 per cent. |
| The market breadth remained negative while volumes dipped through the week. The broad BSE 500 was down 0.44 per cent. The Bank Nifty was however, a gainer to the tune of 2.3 per cent on the basis of a relatively benign RBI policy. |
| The CNX IT dropped a disproportionate 4 per cent. Institutional attitude showed a divergence with domestic funds being net buyers while FIIs sold. Read more in Business Standard |
Down but not out
| India Inc has slowed down in the June 2007 quarter. A sectoral analysis of Q1 FY08 results and what to expect. |
| After running at a breakneck speed for several quarters, India Inc’s financials have taken a breather. In the June 2007 quarter, our universe of 942 companies, excluding banks, financial services, oil and gas companies, and with a turnover of more than Rs 25 crore have shown the slowest growth in terms of almost all parameters like net sales, operating profit and net profit. |
| Net sales and operating profit (excluding other income) have grown at 19.5 per cent and 18.8 per cent year-on-year respectively-the slowest since last four quarters starting June 2006 quarter (Click here to see table: Stocks in Focus). |
| As a result, operating profit margins declined marginally by 11 basis points year on year, thanks to a small rise in total expenditure. However, a growth of 32 per cent in net profit has been maintained on a year-on-year basis, thanks to higher other income, declining interest cost and lower increase in depreciation costs. |
Read more in Business Standard
Ambani brothers ride Mumbai`s makeover
| Today, if you travel by road from the central suburb of Ghatkopar to the western suburb of Versova, it could take you an hour if you are not caught in a bad traffic jam. Come 2009 and you could cover the same distance by the Mumbai metro in 21 minutes and, since the metro will have air-conditioned coaches, you can hope to arrive in good shape. Besides, the maximum fare of Rs 10 will not pinch most pockets. |
| Similarly, if you are a businessman or a senior executive tired of coping with the city’s crumbling infrastructure, you could think of buying an apartment in the Navi Mumbai special economic zone (SEZ), which promises to offer living conditions on a par with the world’s most sophisticated cities. The city will come up next to the Navi Mumbai airport from where you could catch a flight to anywhere in the world. |
| And in case you are worrying about visiting Mumbai, a new 22.5 km, six-lane highway across the harbour will get you to central Mumbai in just 30 minutes. |
| Sounds too good? Well, that’s a glimpse of the future of Mumbai. And what’s common in these dream infrastructure projects is that the Ambani brothers, Mukesh and Anil, are either involved or pitching for them. Read more in Business Standard |
Oracle not to delist i-flex for 5 more yrs
| To consider open offer if price falls below Rs 2,100 a share. |
| Stung by the lukewarm response to its earlier open offer to buy i-flex shares, US-based Oracle has maintained it has no plans to come out with additional open offers for i-flex shareholders for at least the next five years. In a recent filing with the US Securities and Exchange Commission, however, it added a rider stating it may think of an open offer if the share price is below Rs 2,100 per share — its offer price of December 7, 2006. |
| Oracle holds 83 per cent of i-flex’s shares and has been consistently trying to acquire the rest in a bid to delist i-flex from the Indian bourses. It would require a little over 90 per cent of shares to do so. The move will help it to integrate i-flex with its business worldwide. |
| Under current norms, if the minority shareholders do not surrender shares willingly to the new promoter, the Securities and Exchange Board of India’s (Sebi’s) takeover code requires the new promoter to come out with a proposal to buy back the rest of the shares from the minority shareholders under a proposal to delist the company. |
Read more in Business Standard
Novartis loses Glivec patent case
The Madras High Court today dismissed the Novartis petition against the Indian patent law.
The case related to Glivec's patent protection issue.
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