CVC International allowed investing in Flemingo Duty Free Shops by FIPB

Citicorp Venture Capital International’s proposal to acquire 15% stake in Flemingo Duty Free Shops Private Limited (FDSPL) has been approved by the Foreign Investment Promotion Board (FIPB). Flemingo Duty Free runs duty-free shops at various airports and seaports. The deal is valued at more than Rs. 100 crores. The Ministry of Finance had already given the go-ahead to the investment. However, the proposal was awaiting approval pending with the FIPB.

Flemingo would initially issue 1 mn convertible preference shares to CVC International for about Rs. 1000 each, total amounting to Rs. 100 crores. These preference shares would then be converted into equity at a later date for a premium. Citicorp’s shareholding in Flemingo would be up to a maximum of 15% of the paid-up equity of the company.

The current shareholding structure of Flemingo Duty Free Shops includes 51.22% equity stake held by Flemingo International, a company based in British Virgin Islands, and a 24.87% stake held by various NRIs. After conversion of Citicorp’s preference shares; Flemingo International, NRIs and Citicorp would respectively hold 43.54%, 21.14% and 15% in FDSPL, taking the total FDI to 79.68%.

Read more in The Economic Times article.
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Flemingo Duty Free Shops sells 15% stake to Citigroup Venture Capital International; awaits regulatory nod

CVC International to pick up 19.9% stake in Mumbai-based brokerage firm AnandRathi

Citigroup Venture Capital International, one of the prominent private equity investors in Indian businesses has agreed to pick up a 19.9% stake in leading Mumbai-based broking firm AnandRathi Securities. The funds will be utilized for expansion purposes and also for meeting working capital requirements. The company has not disclosed the size of the deal and the price at which the stake is being acquired by CVC International.

AnandRathi offers broking and other market-related services to its customers through a network of 150 branches and over 200 business associates spread across the country.
AnandRathi has achieved reasonably good presence in retail, institutional broking and has taken a foothold in segments like wealth management, IPO and insurance products distribution. Broking accounts for 50-60% of the business while non-broking activities like investment banking, MF, IPO distribution and advisory services account for the rest.

AnandRathi follows a long list of other Indian brokerage and i-banking firms that raised monies through the private equity route in the recent past. Motilal Oswal Securities, India Infoline, Edelweiss Securities, IL&FS Investsmart and Indiabulls Financial Services are some names that have raised funding from PE firms for growth and expansion.

Read The Economic Times article.
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Citigroup VC may invest $15 mn in AnandRathi

Flemingo Duty Free Shops sells 15% stake to Citigroup Venture Capital International; awaits regulatory nod

Citigroup Venture Capital International will acquire 15% stake in Flemingo Duty Free Shops Private Limited. Flemingo runs duty-free shops at various airports and seaports. The deal is valued at more than Rs. 100 crores, as per data available from Foreign Investment Promotion Board (FIPB).

Flemingo would initially issue convertible preference shares to Citigroup for about Rs. 100 crores. These preference shares would be converted into equity at a later date for a premium. Citigroup’s shareholding in Flemingo would be up to a maximum of 15% of the paid-up equity of the company.

Flemingo has sought FIPB approval to issue 1 mn convertible preference shares for Rs. 1000 each to Citigroup. The green signal from the Board is yet to materialize since the Finance Ministry plans to go into details of the deal.

FIPB had deferred Flemingo’s proposal pending completion of investigation and due action by revenue department. Currently, Flemingo International, a company based in British Virgin Islands, holds 51.22% equity stake in Flemingo while various NRIs hold 24.87% stake. After conversion of Citigroup’s preference shares, Flemingo International, NRIs and Citigroup would respectively hold 43.54%, 21.14% and 15% in Flemingo, taking the total FDI to 79.68%.

Read more in The Economic Times article.

ICSA not to sell 14% stake to CVC International; may sell the same to Goldman Sachs

ICSA, a Hyderabad-based embedded technology and electrical infrastructure solutions provider, which was reported to have raised $52 mn from CVC International and Goldman Sachs, now, seems to have excluded CVC International from its investor list.

ICSA will sell 14% equity to global investment bank Goldman Sachs, which will infuse the entire $52 mn to be pumped into the company, part of it for the equity and the rest in foreign currency convertible bonds (FCCBs).

ICSA will not sell equity to Citigroup Venture Capital International Growth Partnership Mauritius (CVC). The company has cited non-fulfillment of regulatory and technical conditions for not going ahead with CVC. The venture capital firm had a 45-day due diligence period, but could not complete the proceedings in time. CVC had sought an extension, but failed to get it from the market regulator SEBI. ICSA was also not in favour of extending the deadline.

Goldman Sachs is believed to have evinced interest in acquiring the 14 per cent stake at higher amount. The deal with CVC was at around Rs. 950 per share, while Goldman Sachs’ offer is at Rs. 1250 per share. This is in addition to Goldman Sachs’ commitment of $22 mn in ICSA through FCCBs.

Goldman Sachs will now hold 14% stake in ICSA and FCCBs to the tune of $22 mn. ICSA is convening a board meeting on March 17 to consider the Goldman Sachs offer.

At present, foreign institutional investment holding in ICSA stands at 25.37%. The company was looking at the investments to meet its working capital requirements, for inorganic investments and R&D related expenses.

Read the Business Standard article.
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ICSA Limited attracts $52 mn foreign investment from Citigroup and Goldman Sachs

Bennett Coleman picks up 5% stake in YOU Telecom

Bennett & Coleman Company Limited (BCCL), the holding company of the Times of India, has acquired a 5% stake in YOU Telecom India Private Limited for an undisclosed sum. YOU Telecom is India’s first ISO 9001:2000 accredited broadband company. Citigroup Venture Capital International is already an investor in YOU Telecom.

Citigroup VC may invest $15 mn in AnandRathi

Citigroup Venture Capital (CVC) is in talks to acquire 10-15% stake in Mumbai-based securities and wealth management firm AnandRathi Securities for around Rs. 70 crores ($15 mn). AnandRathi proposes to come out with a public issue in the next financial year. CVC is in the fray along with a couple of more private equity funds and the deal is expected to be closed within the end of the current fiscal.

This is the first time in 12 years since its establishment that AnandRathi is expected to receive private equity funding. The company offers the entire gamut of financial and advisory services including wealth management, investment banking, corporate advisory, brokerage and distribution of equities, commodities, mutual funds and insurance. Besides having a pan-India presence with 300 offices, it has international presence through its offices in Dubai and Bangkok. AnandRathi also runs a Rs. 150-crore realty fund focusing on partnering with developers in Tier-II cities to cater to the growing demand for quality residential space in these cities and also earmark some investments in rental income yielding office properties. AnandRathi is also planning to launch an overseas $75 mn fund.

Read the Business Standard article.

CVC International invests $33 mn in infrastructure company Indu Projects

Citigroup Venture Capital International, the private equity arm of Citigroup, has invested Rs. 150 crores ($33 mn) in Hyderabad-based infrastructure and real estate player Indu Projects Limited. Indu Projects has placed 9% equity at Rs. 1214 per share, and post-issue, the company’s equity stands at Rs. 13.69 crores while its total valuation stood at Rs. 1650 crores. DSP Merrill Lynch was the financial adviser to the transaction. The proceeds of the private placement are intended to improve the company’s net worth and fund projects in the commercial and residential space that include construction of 28 mn sq. ft. of plinth area in Hyderabad, Bangalore, Pune, Coimbatore, Chennai and Nandyal (Andhra Pradesh). The company has over 30 mn sq. ft. of real estate development under way across the country.

Read the Business Standard and Moneycontrol.com article.
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ICSA Limited attracts $52 mn foreign investment from Citigroup and Goldman Sachs

ICSA Limited, an embedded technology provider, has attracted foreign investment of around $52 mn through two different deals. The company has made a private placement to Citigroup Venture Capital International Growth Partnership Mauritius Limited (CVC), for a sum of $30 mn, while investment banking firm Goldman Sachs has invested $22 mn in the company through the FCCB route.

Citigroup has acquired 14% stake in ICSA by investing $30 mn at a price of Rs. 950 per equity share. With the Citigroup’s investment the level of FII holding in ICSA would go up from 25.37% at present to 30.4%. Citigroup will also nominate a member to the board of ICSA. Since the equity picked up by Citigroup is through a fresh issue the promoter stake in the company will continue to remain at 20.5% after conversion of warrants. The sum raised will be used to fund working capital needs and for investments in R&D.

ICSA has been developing technology solutions for power, water, oil and gas sectors to identify transmission and distribution losses and monitor consumption. ICSA is also looking at expanding its global operations and is looking at acquisitions in the utility sectors like water, gas and power where the utilities can be provided with the products of the company. Overseas markets contribute to 25% of the revenue, which the company expects to go up to 50% in the next few years.

Read The Financial Express article.
Related article: Citigroup plans $1 bn PE spend