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India’s current market situation and the dynamics of its economy are likely to result in continued private equity growth in the coming years, said a study by Boston-based research firm Boston Analytics. “A correction in the stock market, leading to 21 per cent decline in the benchmark index BSE Sensex, in the first two months of 2008, has eased valuations of target companies for private equity investments,” said the study titled “The Private Equity Landscape in India.”The high GDP growth, projected to be 8.4 per cent in 2008, favourable demographics with roughly half of the population under the age of 25, a high domestic savings rate of more than 30 per cent and a comfortable foreign exchange reserves position worth $301 billion in February 2008 also augured well for the private equity investment, it said. […]
Sandalwood Partners, an early stage VC firm has invested in luxury mobile phone company with an initial capital of $2 million. It plans to invest around $10 million over a period of time. Mr Kondamoori said that luxury mobile phone market in India may see a slow uptake and firm plans to sell around 10,000 units in the first year of operation. Globally, there are a few luxury mobile phone brands, some which are part of the handset manufacturers, others as standalone entities. Nokia’s luxury division, Vertu, has handsets in the price range of $310,000, which are available in very limited pieces of 8-10. Others like SonyEricsson, Motorola have handsets priced at $300,000 and $51,800, respectively. Besides, there are other models which are priced in the range of $1,900 to $2,700. India is also the home to around 150 million mobile users and is one of the fastest growing market globally. It is estimated that this market will cross 500-million users by 2010-11. […]
With India’s foreign exchange reserves at over $300 billion and growing, there has been renewed interest in establishing a sovereign wealth fund (SWF), using a part of those reserves. An SWF is a separate pool of assets, primarily (but not exclusively) invested outside the country, and controlled by governments to achieve economic, financial, and strategic objectives. While there are well-established conservative international norms for investing forex reserves, this is not the case with the SWFs, which can engage in more aggressive risk-management practices. India is a significant recipient of investments by SWFs from abroad. […]
Trent Ltd, the Tata group firm which is in the business of retail, has acquired the 24% stake it already didn’t own in retail chain Landmark Bookstore that was held by co-founder Hemu Ramaiah. The deal, for an undisclosed amount, was signed on Wednesday. Ramaiah, the CEO of Landmark, confirmed the deal and said that she had resigned from her post. She is now in the process of starting a retail consulting firm called Shop4Solutions. In 2005, Trent acquired a majority 76% stake in Landmark and its subsidiaries— 75% from Nataraj Ramaiah, Hemu Ramaiah’s brother, and 1% from the latter — for Rs103.6 crore. Trent runs the Westside and Star Bazaar chains. After the acquisition, Himanshu Chakrawarti, a Trent executive, was named COO of Landmark. It wasn’t immediately clear whether he would be named CEO. Chakrawarti said he was not the right person to comment on the subject. An executive at Trent declined to comment on the issue and the firm’s head of marketing Neeti Chopra did not respond to telephone calls and an email from Mint. Ramaiah declined to comment on the value of the deal although a person familiar with the transaction said it was at least Rs100 crore. […]
Indian steelmaker Essar Steel Holdings Ltd. said it would buy U.S. steel producer and distributor Esmark Inc. in a cash offer of $17 a share, deepening its global reach and providing it with a large integrated steel producer and customer base in the U.S. The total value of the deal is about $1.1 billion, according to Esmark officials. If the deal goes through, Essar Steel — a unit of Essar Global Ltd. — will own Wheeling-Pittsburgh Steel, a 2.5-million-short-ton integrated steel mill in West Virginia, and a Midwest distribution network. Along with the cash payout to shareholders, Essar Steel agreed to lend Esmark $110 million to refinance debt and provide needed liquidity.The deal continues the aggressive expansion by cash-rich Essar Steel, which last year bought Canada's Algoma Steel Inc. for $1.6 billion and iron-ore reserves in Minnesota for $1.65 billion, and this month broke ground on a 2.5-million-metric-ton mill in Trinidad. Essar Steel had been looking for an integrated producer in the U.S. and bid for the Sparrows Point steel mill in Maryland but was beat out by Russia's OAO Severstal. […]
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