Fidelity buys 5% in pharma packaging company Ess Dee Aluminium

Mutual fund house Fidelity International has picked up 5% equity in Ess Dee Aluminium, India’s largest provider of pharma packaging solutions, in an open market transaction. The fund has invested close to Rs. 40 crores in the company’s stock that pegs its enterprise value at around Rs. 800 crores. Ess Dee also has been approached by other private equity funds, including Blackstone, for investment opportunities.

The ICICI Group and famous Asian financial commentator Marc Faber already hold around 3.5% and 4% equity, respectively, in Ess Dee. Other investors include Nimesh Kampani of the JM Financial Group and Jagdish Master of Enam.

For more, read The Economic Times article.

Temasek sells stake in Apollo Hospitals for Rs. 134 crores

Singapore government’s investment company Temasek Holdings has sold its entire holding of 5.26% stake in healthcare major Apollo Hospitals Enterprise for Rs. 133.68 crores. The stakes were held by two investment firms Maxwell Mauritius and Aranda Investments.

Maxwell Mauritius sold 2.079 mn shares, while Aranda Investments sold 640,000 shares for Rs. 491.50 each in a bulk deal in the open markets. Aranda Investments’ holding represented a 1.24% stake while that of Maxwell Mauritius represented 4.03% in the Chennai-based healthcare group.

Meanwhile, another fund house Fid Funds Mauritius of Fidelity Investments bought 2.94 mn shares (5.7%) of Apollo for around Rs. 144.62 crores at the same price Temasek’s units sold their stakes. Fidelity Select Portfolios Medical Delivery Portfolio already holds 723,000 shares representing a 1.4% stake in Apollo Hospitals.

Article in Business Standard.

JP Morgan, AIG to launch mutual funds in India

JP Morgan Asset Management, a manager of over $1.013 trn assets across the world, and the AIG group that manages $670 bn will be launching their mutual funds for local investors in India. Both have received the Securities and Exchange Board of India (SEBI) approval for opening shops in India. Fidelity Investment in early 2005 was the last big global player that entered the Indian mutual fund space. Aegon Global, Dawnay Day, Nikko Asset Management, a JV between Ambit Capital and Nikko AMC of Japan, Bharti-AXA, another JV between Bharti Enterprises and asset management firm AXA of France are some of the other players wanting to float funds in India. Currently, the domestic mutual fund industry has 30 players managing Rs. 339,000 crores of assets. JP Morgan plans to start the domestic business with an initial net worth of Rs. 45 crores, AIG has earmarked $20 mn. The Indian regulator requires asset management companies to have a minimum net worth of Rs. 10 crores.

JP Morgan is headed by Krishnamurthy Vijayan, who was heading the JM Financial Mutual Fund for five years. Nandkumar Surti, also of JM Financial, will be heading JP Morgan’s fixed income business in India. Similarly, Saurabh Sonthalia, who heads AIG Global Investment Group, was earlier with DSP Merrill Lynch Mutual Fund. On the investment management side, Tushar Pradhan, who was earlier with HDFC Mutual Fund, will be the Chief Investment Officer, Equities at AIG.

Read the article on livemint.com.

Indiabulls’ overseas real estate arm raises Rs. 1200 crores from LSE’s AIM

Indiabulls Real Estate’s overseas arm, Dev Property Development has raised Rs. 1200 crores from the London Stock Exchange’s AIM market. Investors include LN Mittal, Fidelity, Capital Research and the Singaporean government having picked up large stakes in the IPO. The company’s shares will start trading on the exchange from Monday. The Dev Property IPO was managed by Deutsche Bank, Citigroup and UBS. The lead marketing agent of the issue was CLSA and KPMG is the statutory auditor of Dev Property Development.

Dev Property Development will buy minority stakes in the projects of Indiabulls through a secondary sale of shares by the latter and by investing fresh equity capital in Indiabulls’ projects for a total consideration of Rs. 1055 crores. Indiabulls had received Rs. 437 crores by partial sale of its stake in Jupiter Mills and Elphinstone Mills development projects. Dev Property has also invested Rs. 618 crores in subsidiary companies of Indiabulls undertaking real estate projects. It would also have the right to co-invest along with Indiabulls in its future real estate projects.

Knight Frank has valued Indiabulls’ real estate projects at Rs. 21,569 crores and Indiabulls’ stake in its projects at Rs. 15,125 crores. Indiabulls’ real estate business has been de-merged to Indiabulls Real Estate and its shares are expected to start trading in February. All shareholders of Indiabulls Financial Services received one share of Indiabulls Real Estate for every share they held in Indiabulls Financial Services. In December, Indiabulls Infrastructure, a subsidiary of Indiabulls Real Estate, had sold 13.3% stake to LN Mittal and Farallon for a consideration of Rs. 447 crores.

Read The Times of India article.

Avesthagen sells 20% stake for €25 mn

Bangalore-based integrated life sciences company Avestha Gengraine Technologies Limited (Avesthagen) has closed Series C of private equity fundraising of around €25 mn by divesting 20% equity to external investors. The investment values the company at € 115 mn (Rs. 667 crores). The investors in the company are Fidelity International (10%), the Limagrain Group of France (5%), Daninvest of the Danone Group (4.57%), and Bennett, Coleman & Company Limited (2.4%). The total foreign investment in the company is now over 31%. The existing investors of Avesthagen include ICICI Ventures, Cipla, Godrej Industries, Tata Industries and bioMerieux. The company has also commenced preparations for its initial public offering scheduled to hit the market by mid-2008.

The company commenced its operations as an agri-biotech company in 2001 and then moved on to become a healthcare technology company, pursing its vision of convergence of food, pharmaceuticals, and population genetics, leading to preventive personalized medicine. The other activity of the company has been agri-biotech product development of scientifically validated bioactive nutraceuticals, derived from Indian medicinal plants, as well as the development of bio-similar drugs. The company has four strategic business units: bio-pharmaceuticals, food for medicine (bio-nutritionals), seed for food (agri-biotech) and science and innovation. The company registered Rs. 1.1 crore in profit and Rs. 18 crore revenue in 2005-06.

The funds will be used for Avesthagen’s infrastructure expansion plans, including setting up of manufacturing units and research and development laboratories, and acquisition of technology companies to scale up production and marketing.

Read the article in Business Standard.

Scandent to sell stake in Cambridge Solutions; Apollo, Fidelity, EDS approached

The Economic Times reports that the Scandent Group is selling its majority stake in Cambridge Solutions. Investment bank Lehman Brothers is scouting for buyers for Cambridge which has a large BPO operation in the US. Some US-based funds such as Apollo, Fidelity and strategic players like global IT major EDS have been approached. An information memorandum has also been drafted for the prospective buyers. Cambridge is expected to fetch a valuation of anything above $300 mn, making it the second largest domestic deal in the BPO industry, after the $500 mn sale by General Electric of its 60 % stake in India’s biggest BPO outfit Genpact to Oak Hill Partners and General Atlantic in 2004. At present, the group of original promoters-this include serial entrepreneur Ramesh Vangal, former Pepsico CEO Christopher Sinclair, McKinsey honcho Rajat Gupta, US-Canadian Bronfman family of Seagram fame, the Chanderia family and current CEO Satyan Patel-holds 59.15% stake in Cambridge.

Private funds invest Rs. 146 crores in Provogue

Private equity funds have invested Rs 146.25 crores in retailer Provogue. Fidelity, New Vernon, Blackstone, Genesis Capital, Artis Capital and Liberty International have picked up 3.25 mn preference shares at Rs. 450 per share. Provogue’s promoters are also subscribing to 1.8 mn warrants at the same price.

The new allotments will push up the company’s total capital to 21.24 mn shares. In this, foreign funds will now hold around 15.30%. Promoters and friends will hold 47.34% and 18.31% diluting their stakes from 51% and 24%, respectively. The foreign investment comes with a one-year lock-in. It comes on the back of JV partner, Liberty International, investing Rs. 202.5 crores for a 25% stake in its retail infrastructure subsidiary, Prozone-Liberty.

Read the article in The Times of India and The Economic Times.

NYMEX initiates talks to acquire 9% stake in MCX

Multi-Commodity Exchange (MCX), whose IPO is one of the most looked forward to, is about to bring in a new strategic investor. The New York Mercantile Exchange (NYMEX) is said to be in discussions with MCX for a 7% stake. Earlier, Fidelity International had picked up 9% stake in MCX for $49 mn (Rs. 220 crores). Merrill Lynch is the advisor to MCX on the deal, as well as the manager to the issue. The deal may be valued anywhere upwards of $60 mn (Rs. 270 crores). Both exchanges have declined to comment on this issue. NYMEX had earlier tried to acquire ICICI’s 7% equity stake in NCDEX, which eventually went to Goldman Sachs. Founded by Financial Technologies India, MCX is India’s largest commodity exchange. It accounts for 56% of the total Indian commodity and futures market with an average daily turnover of about $1.5 billion. Indian exchanges are waiting for clarity on the FDI norms for exchanges, even as the government formulates the policy on foreign holding in Indian commodity bourses. SEBI recently issued guidelines for the BSE, proposing a cap of 49% on foreign holding, which includes 26% FDI and the balance 23% for FIIs. Industry anticipates that SEBI would maintain these norms for commodity exchanges in the country as well.

For more details, read the article from The Economic Times.