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Weekly newsletter


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Weekly Economic and Corporate Deals Newspaper

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Weekly newsletter

  1. 1. Top Headlines Moody’s makes open offer to hike stake in ICRA to over 50% for up to $85M. RBS to shed up to 30,000 jobs, shrink investment bank. Reliance Group hikes stake in radio & broadcasting arm to over 90%, set to delist Reliance Broadcast Network. UD Group picking around 10% in Uttam Value Steels for $32M. Facebook to buy WhatsApp for $19B. RIL to raise over $1B through export credit. Coal ministry reclaiming 31 mining blocks. Manipal acquires 280-bed hospital in Rajasthan Inside The Story Moody’s makes open offer to hike stake in ICRA to over 50% for up to $85M. International credit rating agency Moody’s has made a voluntary and conditional open offer to raise its holding in ICRA from 28.5 per cent to up to 55 per cent in what may cost it as much as Rs 530 crore ($85.4 million).The offer is conditional upon Moody’s picking a minimum number of shares which would give it at least 50 per cent holding in India’s second largest rating agency. This would involve shareholders tendering shares worth at least Rs 430 crore ($69 million).Citigroup is managing the open offer.ICRA started as Investment Information and Credit Rating Agency of India Limited (later renamed ICRA Limited) in 1991. 1
  2. 2. RBS to shed up to 30,000 jobs, shrink investment bank. Royal Bank of Scotland is to shrink its investment banking and international operations in a revamp in which the group could shed up to a quarter of its 120,000 workforce, sources familiar with the matter said.The part-nationalized bank has given in to demands from politicians that it focuses on lending to British households and businesses and maintains only a downsized investment banking business to service corporate clients, one source said.RBS, which is 81per cent owned by the British government, could reduce its headcount by up to 30,000 as part of the reorganization, according to sources familiar with the matter. But that figure includes previously announced plans to sell its U.S. retail business Citizens, which accounts for 18,300 jobs, and a UK retail business, Williams & Glyn, which employs 4,500. Reliance Group hikes stake in radio & broadcasting arm to over 90%, set to delist Reliance Broadcast Network. Anil Ambani’s Reliance Group (formerly Reliance ADAG) has raised its stake in its radio and broadcasting firm Reliance Broadcast Network Ltd (RBNL) to 90.33 per cent, as per a stock market disclosure.Promoter group firms Reliance Share and Stock Brokers Pvt Ltd, Reliance Capital Ltd and Reliance Land Pvt Ltd have managed to get minority shareholders to tender 12.2 million shares at an exit price of Rs 70 apiece in the open offer, which would cost around Rs 85 crore.The promoters held around 74.95 per cent as of December 31, 2013 and with the open offer it has crossed the 90 per cent level required to delist a firm from the bourses.RBNL scrip last traded at Rs 67.50 a share, up 0.07 per cent on the BSE in a strong Mumbai market on Friday. 2
  3. 3. UD Group picking around 10% in Uttam Value Steels for $32M. Mumbai-based iron and steel manufacturer Uttam Value Steels is raising Rs 200 crore ($32.16 million) through a preferential allotment of shares to a Singapore-based strategic investor, as per a stock market disclosure.The company’s board has approved issue of up to 129 million equity shares to UD Industrial Holding Pte Ltd at an issue price of Rs 15.50 each. The allotment is to be made at over two times the current market price.UD Industrial Holding is the holding arm of industrial vertical of UD Group whose flagship group firm is Ushdev International, one of the top 50 metal trading companies in the world in terms of annual sales. Facebook to buy WhatsApp for $19B. Facebook Inc will buy fast-growing mobile-messaging startup WhatsApp for $19 billion in cash and stock in a landmark deal that places the world’s largest social network closer to the heart of mobile communications and may bring younger users into the fold.The transaction involves $4 billion in cash, $12 billion in stock and $3 billion in restricted stock that vests over several years. The WhatsApp deal is worth more than Facebook raised in its own IPO and underscores the social network’s determination to win the market for messaging. RIL to raise over $1B through export credit. Mukesh Ambani-promoted Reliance Industries (RIL) is in talks with four or five export credit agencies (ECA) to raise over $1 billion (Rs 6,220 crore) in the next four months. This is a part of the company’s plan to raise $13 billion (Rs 80,625 crore) debt to fund expansion of its petrochemical production capacity and gasification project for its refining facilities to improve margins. In the past two years the company has already tied up over $10 billion of foreign currency financing for this purpose. After tying up all its ECA facilities with 3
  4. 4. Another 4-5 ECA’s for an additional amount of $1 billion, RIL will have the largest number of ECA relationships globally. Coal ministry reclaiming 31 mining blocks. The coal ministry is taking back 31 coal blocks allocated to private firms including the Tata group and Jindal Steel and Power over delays in developing them, jeopardising billion-dollar projects and inviting warnings of legal action.The ministry, reviewing some 61 coal blocks allocated over the past decade that have not started production yet, announced on Tuesday it is reclaiming about half as companies have failed to meet milestones. The companies say delays in getting some government clearances hampered work on the blocks.The Tata group, in partnership with South Africa's Sasol, was planning to invest $10 billion in a project to convert low-quality coal into oil starting 2018. Jindal Steel too was working on a similar project and had spent about $12 million out of total planned investment of $10 billion. Manipal acquires 280-bed hospital in Rajasthan Manipal Health Enterprises Ltd, the healthcare arm of Manipal Group, has entered the market in Rajasthan by acquiring SK Soni Hospital in Jaipur for an undisclosed amount. The 280-bed hospital will be rebranded as Soni Manipal Hospital.“This development is a part of our ongoing growth strategy to expand footprint in India and identified countries of Middle East, Africa and ASEAN. We are executing on this growth strategy by adding to our capacity. This development is coming soon after the recent acquisition of an operational hospital and also building a new one in Kuala Lumpur,” said Swami Swaminathan, executive chairman of Manipal Health Enterprises.The group acquired a 72-bed hospital in Kuala Lumpur last year where it plans to raise its capacity to 200 beds. As part of its expansion in Rajasthan, the company plans to invest Rs 100 crore in its operations in the city, a company release said. 4
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