Dabur to buy 60% stake in Singapore-based FMCG company Unza for Rs. 675 crores

Dabur is about to acquire over 60% stake in Singapore-based consumer goods company Unza Holdings for Rs. 600-675 crores. Dabur is expected to buy out the holdings of private equity funds Actis and Standard Chartered who hold 30% each in the $150 mn-Singapore company. The deal is touted to be one of the largest overseas acquisition deals in the FMCG space, and make it the third-largest FMCG company in India behind HLL and ITC with manufacturing facilities in China, Vietnam, Indonesia and Malaysia.

Unza is a leading personal care manufacturer and marketer in South-east Asia with 48 brands in its portfolio, and is equally owned by the company management and the two private equity funds.

Read more in The Economic Times article.

Ujala maker Jyothy Laboratories plans Rs. 300 crore-IPO

Mumbai-based fast moving consumer goods company Jyothy Laboratories, famous for its Ujala brand of fabric whiteners, is planning to list on the stock exchanges by end of 2007. Jyothy Laboratories will raise Rs. 300 crores in an initial public offering. The company has reportedly appointed Kotak and Enam as advisors to the issue.

Jyothy Labs is a closely held company with about 70% stake being held by founder chairman and managing director M P Ramachandran and his family. The balance 30% is held by private equity firms CLSA and Actis along with a foreign subsidiary of ICICI Bank. The foreign investors are likely to exit the company at the time of the IPO.

Sales of Jyothy Laboratories are pegged at between Rs. 400-500 crores. The company is said to have been valued at around Rs. 1000 crores.

Read more on Moneycontrol.com.

Morgan Stanley, Citigroup, Actis buy 6% in NSE

Global banks Morgan Stanley and Citigroup and private equity firm Actis today collectively bought a 6% stake in the National Stock Exchange (NSE) for an undisclosed sum. The stake sale takes the combined foreign direct investment in the NSE to 26%, the maximum limit for foreign ownership in domestic stock exchanges. Morgan Stanley will buy 3% in the NSE, while Citigroup and Actis will acquire 2% and 1%, respectively.

Domestic financial institutions IDBI (2%), State Bank of India (1.5%), SBI Capital Markets (0.50%), Corporation Bank (0.265%), Union Bank of India (0.125%), Bank of Baroda (0.89%), Canara Bank (0.385%) and Oriental Bank of Commerce (0.335%) are selling their stakes to the three new investors.

Early this year, the parent company of the New York Stock Exchange (NYSE) and three global financial institutions, General Atlantic, Goldman Sachs and Softbank Asian Infrastructure Fund, bought 20% in NSE, valuing the exchange at $2.3 bn. NYSE had paid $115 mn for its 5% stake. Recently, Germany’s Deutsche Boerse and Singapore Exchange (SGX) bought 5% stake each in the Bombay Stock Exchange (BSE) for just over $ 42 mn. Yesterday, it was reported that the Calcutta Stock Exchange also plans to sell a 51% stake and has invited bids from investors and strategic partners, in keeping with Indian regulations that require broker-owned exchanges to reduce the stake held by members to 49%, in a bid to make exchanges professionally run. PricewaterhouseCoopers is the advisor to the proposed sale.

Read the Business Standard article.
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M&M wins Punjab Tractors bid; to pay Rs. 951 crores for 43.5% stake

Mahindra & Mahindra (M&M), the country’s largest tractor company, has turned out to be the winner in the Punjab Tractors stake sale. M&M will shell out Rs. 360 per share for a 43.5% stake, valuing Punjab Tractors at around Rs. 2200 crores. M&M will end up paying a total consideration of a little over Rs. 951 crores in an all-cash deal to buy out private equity firm Actis and the Burman family of Dabur from Punjab Tractors. Actis will gross Rs. 634 crores from the sale of its 29% in Punjab Tractors, while the Burman family will get around Rs. 317 crores for its 14.5% stake.

The final round of bidding boiled down to a contest between M&M and Ashok Leyland. Initially, Ashok Leyland was known to have offered Rs. 320 per share of PTL while M&M was said to have made offers in the range of Rs. 330-335 per share. M&M also offered a part-cash, part-stock option but finally clinched the deal when it upped its all-cash offer to Rs 360 per share. M&M will now have to make an open offer to buy an additional 20% in Punjab Tractors, as per SEBI regulations.

Read the article in The Economic Times.

Actis and the Burmans seek re-bids for Punjab Tractors

Private equity fund Actis and the Burman family, the promoters of Dabur, who together hold a controlling 43.5% in Punjab Tractors (PTL), have rejected offers for the acquisition of their stake from seven interested parties. These companies include Mahindra & Mahindra, Ashok Leyland and Sonalika Tractors and have now been asked to make binding bids by next Monday.

The re-bid was reportedly prompted due to the non-binding nature of the offers. Also, the bids were much lower than the company’s share price, which has shot up around 30% in the month after the bids were invited.

Actis holds 29.5% and the Burmans hold 14% in the Rs. 958-crore tractor company, while the rest is held by financial institutions, the public and banks. Punjab Tractors is India’s fourth-largest tractor making company, with an 8% market share.

Read Business Standard article.
Related Posts:
M&M, TAFE eye Actis’ 29% in Punjab Tractors
M&M, Escorts vie for stake in Punjab Tractors; Actis, Burmans to sell out
Ashok Leyland bids for Punjab Tractors

Alagappan Murugappan returns to ICICI Securities as head of equities

Alagappan Murugappan has re-joined ICICI Securities, the investment banking division of The ICICI Group as head of equities. Prior to this, he was with private equity firm Deeva Capital where he was a partner and returns to the ICICI fold after an overall three-year stint in private equity. Before he joined ICICI Securities, Murugappan was with Cazenove, heading its Indian operations; Cazenove was primarily into equities broking. Murugappan began his career with Cazenove in London after qualifying as a solicitor in England. He holds an LLM from Cambridge University.

Murugappan was one of the three founding partners of Deeva Capital and had spent one year at Deeva. Deeva Capital is a start-up private equity firm with about $100 mn secured from international seed funding. Murugappan had left ICICI Securities in early 2004 to pursue a career in the private equity business. Then, Murugappan had joined Actis as an investment principal and was responsible for leading and coordinating fundraising activities relating to South Asia and for deal generation in India. Murugappan quit Actis to form Deeva in early 2006.

Read more in the article in AsianInvestor.net.

M&M, Escorts vie for stake in Punjab Tractors; Actis, Burmans to sell out

Mahindra and Mahindra (M&M) has put in a non-binding bid for acquiring stake in Punjab Tractors. The Burman family, which holds a 14.5% stake in Punjab Tractors, is interested in selling its stake in the company. Private equity firm Actis which is another major stakeholder in Punjab Tractors has also put in its 29% stake in Punjab Tractors on the block. The Burmans, promoters of Dabur India, are reportedly interested in selling their stake to the buyer of Actis’ stake in the company. Escorts also has shown interest in buying stake in Punjab Tractors, but has not put in a formal bid yet.

Read the Business Standard articles – 1 2.
Related Post: M&M, TAFE eye Actis’ 29% in Punjab Tractors

SBI, IDBI and others to sell 11% stake in NSE

State Bank of India along with Indian Overseas Bank, Union Bank of India, Corporation Bank and IDBI are looking to sell upto a combined 11% stake in the National Stock Exchange. This follows the sale of a 20% stake by five other leading financial institutions in the exchange.

Several private equity players such as Blackstone and Actis have shown interest in buying the stake. Earlier, the New York Stock Exchange (NYSE), Goldman Sachs, General Atlantic and Softbank Asian Infrastructure Fund bought 5% each in NSE from a consortium of five domestic financial institutions. IFCI sold 7% for Rs. 779 crores, while both ICICI Bank and IL&FS divested 5% each for around Rs. 550 crores. GIC sold 2% for Rs. 205 crores and PNB sold 1% stake for Rs. 102 crores. The sudden interest in NSE from foreign players comes after the Reserve Bank of India allowed foreign investment of up to 49% in stock exchanges, fixing the foreign direct investment cap at 26% and foreign institutional investor limit at 23%. Rules stipulate that no single entity can hold more than 5% in a stock exchange.

Read the Business Standard article.
Related Post: NYSE, Goldman Sachs, General Atlantic, SAIF to buy 26% in NSE

Actis hikes open offer for Phoenix Lamps to Rs. 190

Business Standard reports that PE fund Actis has decided to increase the open offer price for Phoenix Lamps by 25% to Rs. 190 a share, following a directive by the Securities and Exchange Board of India (SEBI). The revised open will open on February 5 and close on February 24.

The mandatory 20% open offer was triggered after Actis bought the entire 37% stake in Phoenix Lamps from its promoters, the Gupta family, last year. The open offer was priced at Rs. 152 a share and was supposed to open on August 31 and close on September 19. Yes Bank was the adviser to Actis for the offer. Actis had agreed to pay Rs. 190 a share to the Guptas, 25% higher than the price of the open offer on account of non-compete fees. However, market regulator SEBI did not agree to this argument. Actis will now make the open offer at Rs. 190 to buy the shares of the remaining shareholders.

Related Post:
SEBI asks Actis to pay Phoenix Lamps’ minority shareholders same price as paid to promoters

Norwegian company to buy MTR Foods for Rs. 350 crores

Norwegian food company Orkla Foods may turn out to be the acquirer of South-based MTR Foods. The deal size is said to be around Rs. 325-350 crores. Earlier, US spice company McCormick was widely tipped to take over MTR. However, the deal fell through at the last minute due to differences over structuring of the deal, particularly on certain intellectual property issues relating to the brand name.

Orkla is keen on acquiring MTR as it will provide a launch pad for Indian operations. The Norway-based company has presence in bakery, seafood, pizzas, pies, taste enhancers and snacks. In the past, Orkla has grown its international presence through acquisitions in Romania, Sweden, Denmark and Iceland. Orkla Foods is part of Orkla ASA, one of Norway’s largest listed companies with its core businesses being branded consumer foods, specialty materials and financial investments.

MTR’s brand pull is such that several large Indian corporates, including Tata Coffee, ITC, Godrej and several PE funds like Blackstone, Indivision and Actis had shown interest in the company. NM Rothschild was the investment banker for MTR, and had estimated a value of Rs. 300 crores on the company when it called for bids earlier this year. The Maiya family controls 59% stake in the company directly and indirectly, with JP Morgan holding 26% stake. Another fund, Aquarius, holds 14-15%. MTR’s portfolio comprises ready-to-eat, ready-to-cook food ingredients and spices.

Read The Economic Times article for more details.

M&M, TAFE eye Actis’ 29% in Punjab Tractors

Actis’ 29% stake in India’s most profitable farm tractors and forklifts company, Punjab Tractors Limited (PTL), is probably up for sale. Mahindra & Mahindra (M&M) and Tractor & Farm Equipment (TAFE) seem to be the interested parties. The Burman family of the Dabur group, which holds 14% in PTL, may also exit along with Actis.

Actis’ stake is valued at Rs. 410 crores, but the buyer may also have to pay a control premium. It would also have to make an open offer to the remaining shareholders.

Read the complete Economic Times article.