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Weekly newsletter

  1. 1. 1Top HeadlineKingfa Sci to acquire 66.5% stake in Hydro S&S Industriesfor $1.9M.Yahoo to acquire Tumblr for $1.1B in cash.Mentor Graphics acquires software products business ofSoftJin.Wockhardt says FDA alert affects potential sales of $100M.Naresh Goyal buys 29% stake in Jet Airways from overseasentity for $257M.Mytrah Energy buying 59.75 MW of wind power assets inTamil Nadu, Maharashtra.Shree Renuka Sugars to raise $350M through its Brazilianarm.Zee Learn raises $20M through GDRWeekly Finance NewsKey benchmark indices posted their first weekly fall in six, ending apowerful rally since mid-April as dismal earnings from L&T and SBIcoupled with weak global cues after disappointing data from China andcomments from the US Federal Reserve about tapering its stimulusprogram weighed on sentiment.The benchmark BSE index rose 0.15 percent, or 30 points, to end at19,704.33 on Friday, but was down 2.87 percent or 581.79 points forthe week, marking its biggest weekly fall since the week ended onMarch 24.Similarly, the broader NSE index rose 0.28 percent, or 16.50 points, toend at 5,983.55, but ended 203.75 points or 3.29 percent lower for theweek, also its biggest weekly fall since late March. The market droppedin four out of five trading sessions in the week ended Friday, 24 May2013.
  2. 2. 2The BSE Mid-Cap index declined 3.43 percent and the BSE Small-Capindex fell 3.33 percent. Both these indices underperformed the Sensex.Still, doubts persist about how long foreign investors will continue tobuy, while investors are also growing wary ahead of January-Marcheconomic growth data next week which will likely confirm whether theeconomy has gained some traction on the governments reform movesand the central banks rate cuts.The govt will release January-March quarter GDP on Friday, which isexpected to confirm the economy grew at its slowest pace in a decade inthe 2012/13 fiscal year.Investors will also be eyeing whether strong foreign buying continues.Foreign institutional investors extended their record net purchases ofIndian stocks to a 26th consecutive sessions on Thursday, despite sharpfalls sparked by worries the Fed would unwind its monetary stimulusearlier than expected.Companies will also continue to report January-March earnings,including Coal India Ltd, Sun Pharmaceutical Industries Ltd, and CiplaLtd.Inside The StoryKingfa Sci to acquire 66.5% stake in Hydro S&S Industriesfor $1.9MChinas plastic manufacturer Kingfa Sci & Tech Co Ltd has entered into adefinitive agreement to acquire 66.5 per cent stake in Chennai-basedHydro S&S Industries Ltd (HSSIL), a manufacturer of reinforcedpolypropylene compounds, for Rs 10.65 crore ($1.94 million) from thepromoters of the company, as per a stock market disclosure.Kingfa Scihas also filed for an open offer to acquire 16,65,874 more equity sharesfrom public shareholders of HSSIL, constituting 26 per cent of the fully
  3. 3. 3paid up equity share capital of the company at Rs 42.70 per share,aggregating Rs 7.11 crore ($1.29 million).Yahoo to acquire Tumblr for $1.1B in cash.Yahoo Inc said it is acquiring blogging service Tumblr for $1.1 billioncash, a bold bet by Chief Executive Marissa Mayer to revitalize thestruggling Internet pioneer by co-opting a Web property with strongvisitor traffic but little revenue.The deal, which will use about a fifth ofYahoo’s $5.4 billion in cash and marketable securities, is the largest byfar since Mayer took the reins in July seeking to reverse a multi-yeardecline in Yahoo’s business and Web traffic.Mentor Graphics acquires software products business ofSoftJin.Mentor Graphics Corporation, a US-based technology firm, has acquiredthe photomask and lithography related software products business ofBangalore-based SoftJin Technologies Pvt Ltd for an undisclosedamount. Nishith Desai Associates acted as the legal counsel for SoftJinfor the transaction.Mentor Graphics deals in electronic hardware andsoftware design solutions, providing products and consulting services.Established in 1981, it reported revenues of about $1,090 million in thelast fiscal year.Wockhardt says FDA alert affects potential sales of $100M.Drug maker Wockhardt Ltd said up to $100 million in annualisedrevenue could be lost as a result of a U.S. Food and Drug Administration"import alert" on one of its plants, but said it should be able to restoremost of that within 6 to 9 months by shifting productionelsewhere."That is a worst-case scenario," Wockhardt Chairman HabilKhorakiwala said, referring to the $100 million, in a conference call withreporters.
  4. 4. 4Naresh Goyal buys 29% stake in Jet Airways from overseasentity for $257M.Jet Airways chairman Naresh Goyal has transferred around 29 per centstake in the country’s second-largest carrier from another overseaspromoter entity owned by him through a stock market transactionworth Rs 1,434 crore ($257 million).The shares were transferred fromoffshore entity Tail Winds Ltd to Goyal’s own name at Rs 570 a piece. JetAirways scrip rose 0.78 per cent to close at Rs 584.25 a share, on theBSE in a weak Mumbai market on Thursday.With this, Goyal’s personalholding in the company has touched over 29 per cent. As of March 31,2013, he held 79.9 per cent stake in the airlines through Tail Winds outof the 80 per cent total promoter holding.Mytrah Energy buying 59.75 MW of wind power assets inTamil Nadu, Maharashtra.Hyderabad-based Mytrah Energy India Ltd (MEIL), a wholly ownedsubsidiary of London Stock Exchange-listed Mytrah Energy, is acquiring59.75 MW of operational wind power assets in Tamil Nadu andMaharashtra for an undisclosed amount. The firm has not disclosed thename of the seller.These assets, which have an average age of under 12months, comprise turbines from Gamesa, ReGen and Enercon.In a stockexchange statement, Mytrah said it has received conditional offers fordebt financing for the acquisition which is subject to regulatoryapproval and formal documentation.Shree Renuka Sugars to raise $350M through its Brazilianarm.Sugar manufacturer Shree Renuka Sugars is looking to raise around$250-350 million (Rs 1,350-1,925 crore) through a bond sale throughits Brazilian subsidiary, Renuka Do Brasil S/A. These bonds will carry aguarantee from the listed Indian parent. The company targets raisingaround $250 million with an upside of another $100 million. Last year,the company failed to raise money from Brazilian sugar manufacturer
  5. 5. 5ETH Bioenergia, owned by three partners, namely, PE fund Ashmore,Brazilian Brandes Bank and Brazilian conglomerate Odebrecht, byselling stake in the Brazilian company. However, the talks fell throughdue to valuation mismatches. Credit Suisses Brazil arm is said to beadvising the company on the bond sale.Zee Learn raises $20M through GDRZee Learn Ltd, the education arm of Essel Group, has raised $20 million(Rs 110 crore) through Global Depository Receipts (GDR), the firminformed the stock exchanges on Tuesday.The GDR issue was fullysubscribed and the company will allot 56,17,977 GDRs at a price of$3.56 per GDR. Each GDR represents 10 underlying equity shares in thecompany and the GDRs will be listed on the Luxembourg StockExchange. This would represent equity dilution of around 18 percent.The issue was at an effective price of Rs 19.7 a share. Zee Learnscrip closed at Rs 19, down 0.26 per cent on the BSE in a weak Mumbaimarket on Tuesday.