IDBI plans raising Rs. 1500 crore-Tier II bonds

IDBI will raise around Rs. 1500 crores by way of Tier-II bonds in the coming 12 months. This is to support credit growth and Basel II norms and supplement for capital bonds that will be redeemed over next few months. Present capital base can support 20% annual growth in assets for next two financial years. However, the bank wants to provide adequate cushion for business expansion and Basel II compliance. Currently, IDBI has an outstanding Tier-II bond portfolio of Rs. 5000 crores. A part of this bond portfolio will mature soon. The new bonds may be issued in tranches depending on the business requirement over a year. The lower Tier-II bonds will have tenure ranging between 5 and 10 years and will carry slightly higher coupon rate than debentures. CRISIL has assigned an AA+ rating to the proposed issue. The public sector bank has raised Tier-II capital of about Rs. 1418 crores till date in the present financial year. The bank is adequately capitalized with CAR of 14.09% at end of December 2006.

Read more in the Business Standard article.

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

JK Cement buys Nihon Nirman for Rs. 42 crores

JK Cement has acquired Nihon Nirman from the Industrial Development Bank of India (IDBI) for Rs. 42 crores. The acquisition of the 300,000-tonne Nihon Nirman plant will push up JK Cement’s capacity to produce grey cement to 4.3 mn tonnes per annum. JK Cement would invest another Rs. 33 crores for converting the white cement making plant into a grey cement plant. The production is expected to begin by September and would help JK Cement increase its grey cement capacity at a lower cost. The grey cement would be produced from Nihon Nirman and will be sold in the northern markets, where the company enjoys a strong presence. A team from the Japanese firm Taiheiyo Cement Corporation visited the Nihon Nirman site and calculated that it could produce 300,000 tonnes of grey cement per annum. The plant will cater to Rajasthan market, especially in the Jodhpur and Ganganagar belt. With this new grey cement plant, the company expects to save up to Rs. 1000 per tonne.

Article in the Business Standard.

Indiabulls founder Sameer Gehlaut picks up 25% in BAG Films

Indiabulls co-founder and chairman Sameer Gehlaut has invested in Delhi-based TV and film content company BAG Films. Gehlaut is buying around 25% stake in BAG Films for Rs. 262 mn ($5.7 mn). Gehlaut has been made a preferential allotment of up to 20.25 mn equity shares of Rs. 2 each at a price of Rs. 13 per share. It is now mandatory for Gehlaut to make an offer for a further 20% stake. A fully subscribed open offer would make Gehlaut BAG’s largest shareholder.

The promoters of BAG Films, Rajiv Shukla and Anuradha Prasad own about 37.5% on the expanded equity currently. According to Anuradha Prasad, MD of BAG Films, Gehlaut has come in as a pure financial investor. BAG also plans to invest about Rs. 160 mn in new media and the animation business. Recently, IDBI Bank and Bank of Baroda have picked up 10% each in BAG Films’ radio venture, BAG Infotainment.

For more, refer to the Indiantelevision.com article.