Air Deccan seeks $75-100 mn private equity; hires Edelweiss for PE syndication

Air Deccan is planning to raise around $75-100 mn for its expansion plans, and has reportedly approached the Reliance ADAG Group and a Delhi-based conglomerate for the same. Investment bank Edelweiss Capital has been mandated by the low-cost airline to help raise private equity. Texas Pacific Group, Carlyle Group, Standard Chartered Private Equity, Macquarie Capital, ChrysCapital, Lehman Brothers, General Atlantic and GIC of Singapore are some of the investment firms that have been sounded out. The process is expected to be completed over the next three months.

Additionally, Air Deccan is also looking to raise money by securitizing its future receivables or by issuing bonds, and is in talks with global players like International Lease and Finance Corporation (ILFC) and GE Commercial Aviation Services (GECAS).

Read the complete article in The Economic Times.

Reliance India Power Fund buys 15% in KRYFS Power Component

Reliance India Power Fund has acquired a 15% stake in KRYFS Power Component for an undisclosed sum. Reliance India Power Fund is a 50:50 JV between the Reliance-ADAG financial services subsidiary Reliance Capital and Singapore-based private equity firm Temasek Holdings. The corpus of the fund is $200 mn and has been set up to invest in Indian power ancillary companies. Su-Kam Power Systems, EMI Transmission, and Ravin Cables are some of its investee companies.

The fund invested Rs. 45 crores in Delhi-based Su-Kam Power Systems for a 20% stake and Rs. 50 crores in Mumbai-based EMI Transmission, an unlisted power equipment company, for a 23% stake.

KRYFS Power Component is a Rs. 300-crore manufacturer of transformer cores and patented sling-set twin path slings. It will utilize the funds for capacity expansion and diversifying into newer businesses through organic and inorganic means. The company manufactures high-tenacity fiber slings in collaboration with Slingmax, Inc. of USA and currently has a capacity to produce nearly 12,000 mt of transformer cores, wound cores and built up cores.

Read The Economic Times article for more details.

ADAG-Shringar acquisiton talks fall out over valuation differences

The Anil Ambani led-ADAG group is in the news for another merger and acquisiton deal, and it seems that this may also go sour. Negotiations between ADAG and the Shroffs of Shringar Cinema for buying out Shringar seem to have hit a roadblock due to differences on the price that ADAG has reportedly offered to Shringar’s shareholders.

Reliance-ADAG was willing to offer Rs. 58 per share and an additional Rs. 15 was offered for a non-compete agreement to the Shroffs, promoters of Shringar Cinemas. The clause was to ensure that the future plans of the Shroffs don’t affect the Reliance-ADAG group, which already has an interest in the sector through Adlabs Films.

The deal would make Adlabs Films the biggest player in the multiplex business along with the Delhi-based PVR, which currently has close to 75 screens across the country. The acquisition would give Adlabs access to Shringar Cinemas’ approximately 35 screens, putting Adlabs at a total of about 78 screens pan-India.

It has been learnt that large stakeholders in Shringar Cinemas had expressed reservations on the differences in the price offered by ADAG to the promoters and to shareholders. Temasek Holdings, one of the largest shareholders in Shringar Cinemas with close to 14%, expressed its reservations on the pricing, even when the Shroff family had agreed to this deal in-principle. The owners of Shringar Cinemas have been in talks with large players, including the Mukesh Ambani-led Reliance Industries, but the talks had failed, again, due to valuation differences.

While the deal is off now, it is expected that talks between both parties could resume, as a consolidation in the multiplex space is inevitable. Shringar runs the Fame brand of multiplexes and plans to add seven to nine multiplexes each year to touch 227 screens across 50 sites by March 2011.

Read he article in The Economic Times.