1. JPMorgan Designs Bond for Agarwal to Amass $2.4 Billion Anglo Stake
London-based billionaire Anil Agarwal’s family holding company Volcan Investments launched a £2 billion ($2.4 billion) mandatory exchangeable (convertible) bond issue on Thursday to fund its planned acquisition of about 13% in commodities giant Anglo American, rival to his Vedanta Resources. Funding an acquisition through bonds rather than cash is unusual, bankers said.
In a coup of sorts, JPMorgan Chase & Co is sole book runner and underwriter to the transaction and will be raising the resources on behalf of the Agarwal family office.
The bonds will be exchanged either for cash or for Anglo American shares in 2020. The fund-raising is expected to get completed by next week, multiple sources close to the process told ET.
The three-year instrument is being offered with annual coupon payments of about 3.75-4.2% and Volcan will pledge Anglo American shares that it accumulates as a security to the transaction.
(Source: Economic Times)
2. Is Tata Sons Asking For a Trial Before a Trial?
Oppression is an exception to corporate democracy, CA Sundaram had earlier argued this while making a case for Cyrus Mistry firms’ waiver application. On Friday, Tata Sons’ counsel Abhishek Manu Singhvi responded that the alleged oppression does not exist.
The National Company Law Tribunal’s (NCLT) Mumbai bench on Friday heard Tata Sons’ arguments against granting a waiver to Mistry’s firms. Two Mistry firms are seeking a waiver of the shareholding requirement for bringing an oppression and mismanagement action against Tata Sons.
The Mistry firms sought the waiver after the NCLT on 6 March, ruled that the companies did not have the requisite 10 percent of the total shares in Tata Sons to pursue the charges, as required under Section 244 of the Companies Act, 2013 (Act). The Act gives the NCLT discretion to waive this 10 percent threshold condition.
3. ITC Shares Close at All Time High After GST Cess Impact Seen Neutral
Shares of cigarette maker ITC Ltd on Friday surged 4.85% to close at a record high with analysts saying the Goods and Services Tax (GST) imposed on the cigarette industry is neutral.
The stock touched a high of Rs 289 on the BSE and gained as much as 7.8%, its biggest gain since 23 May 2016. So far this year, it has gained 15%. It closed at Rs 281.20 on the BSE from previous close, while the benchmark Sensex index rose 0.21% to 29,648.99 points.
Other cigarette companies too were trading higher. VST Industries Ltd jumped 6.2%, while Godfrey Phillips India rose 0.8%.
4. Government Plans to Swap CEOs of IDBI Bank and Indian Bank
The government is likely to tap Indian Bank chief executive MK Jain to try and turn around troubled IDBI Bank (BSE -1.11%) after seeing his hand in the stunning transformation of the Chennai-based lender. Jain, who is credited with making Indian Bank profitable, would swap positions with IDBI Bank chief Kishor Kharat, who would move to head Indian Bank.
This is the first time in recent memory that such a move is being considered and it is likely to set a precedent with performers being rewarded with challenging assignments, said two people familiar with the matter. A formal announcement is likely soon.
Under Jain’s leadership, Indian Bank shares have delivered an over-three-fold jump in returns even as many of lender’s peers have struggled amid rising bad loans. In contrast, IDBI Bank is up just 22% from its year’s low. The stock price of the two banks reflects their financial performance over the past year.
(Source: Economic Times)
5. Music Broadcast Shares Close Up 12% on Stock Market Debut
Shares of Radio City FM’s operator, Music Broadcast Ltd made a strong debut on the stock markets on Friday with listing over 26% premium after its issue subscribed 39.3 times for its Rs 400 crore initial public offer (IPO) last week.
The stock opened and touched a high of Rs 420 a share. The scrip, however, pared some gains and closed at Rs 373.15 on the BSE, up 12.06% from its issue price of Rs 333. It hit a low of Rs 368 a share, in intraday. India’s benchmark Sensex index rose 0.21% to closed at 29,648.99 points.
Analysts at Prabhudas Lilladher in a 3 March report said that the company has a 12-13% market share and is expected to report revenues of Rs 267 crore for financial year 2017, a compounded annual growth rate (CAGR) of 17% for the past five years.
6. Wilful Defaulters Owe State-Owned Banks Rs 91,155 Crore, Says Government
There were 9,130 wilful defaulters in the country who had taken loans amounting Rs 91,155 crore from various public sector banks, Minister of State for Finance Santosh Gangwar said in Lok Sabha, according to wire agency PTI.
Replying to a question about the action taken against Vijay Mallya, Gangwar, without taking his name, said the person whose name was mentioned was given loans in September 2004 and this was reviewed in February 2008.
Loans to the tune of Rs 8,040 crore were given to the liquor baron when the previous United Progressive Alliance (UPA) government was in power, but action against him for defaults is being taken by the Modi government, the minister said. This loan was declared as a non-performing asset in 2009 and the NPA was restructured in 2010.
7. Bharti Airtel Close to Buying Tikona’s 4G Spectrum
Bharti Airtel Ltd is in the final stages of talks with Tikona Digital Networks Pvt. Ltd to buy the latter’s 4G spectrum, as India’s largest telecom company seeks to increase its capacity to offer data services to customers.
The deal would be another step in the process of consolidation set off by the aggressive pricing strategy of Mukesh Ambani’s Reliance Jio Infocomm Ltd, which entered the telecom industry in September.
The Bharti-Tikona transaction could be in the range of Rs 800-1,000 crore, three people familiar with the matter said on condition of anonymity. Tikona has some debt on its books which Airtel will assume, so the overall deal value is close to Rs 1,500-1,700 crore. The deal will be split into multiple tranches.
Tikona is hiving off its wireless broadband business, Tikona WiBro, which it will continue to run independently.
8. Reliance Capital’s CPSE ETF Subscribed 3.7 Times
The Central Public Sector Enterprises Exchange Traded Fund, or CPSE ETF, managed by Reliance Capital Asset Management Co. has been subscribed over 3.7 times. The government aims to raise Rs 2,500 crore from its third sale of the ETF as part of its divestment plan.
The issue was open for subscription from 15-17 March.
According to a company statement, more than 1.2 lakh retail applications were received for subscription and this portion was subscribed two times. The institutional portion was subscribed 7.6 times.
The ETF saw strong anchor investor interest with bids of Rs5,700 crore, which is over 7.5 times the amount reserved for them. Some of the anchor investors include BNP Paribas, Morgan Stanley, SocGen and CitiGroup.
9. Obscure Chinese Phone Companies Ring in Big Plans for India
A Tinno phone? Or a Huaqin or a Malata? The world’s second largest and fastest growing mobile phone market is about to be flooded by virtually unheard of Chinese brands. Not to forget Infinix and Cat phones – products from other countries that are relatively less known but have big plans for India.
Most of them are looking at the feature phone to smartphone conversion market – only 300 million of 1 billion phone users in India have smartphones – as well as at feature phones.
One little known Chinese brand has already entered India – iVoomi launched four smartphone models a few days back.
Chinese brands have already taken four out of the top five slots in India’s smartphone segment: Xiaomi at No 2, followed by Lenovo, Oppo and VivoBSE 0.05 %. The share of China-based vendors is a huge 46% for the October-December 2016 quarter.
(Source: Economic Times)