You are here: Home >> English News & Features >> BUSINESS & ECONOMY

More promoters giving PEs the reins

DNMUM159426 | 1/11/2010 | Author : Khyati Dharamsi | WC :582

Trend seen limited to some sectors, such as generics

In a new trend for the country, promoters are increasingly willing to offer private equity (PE) firms controlling stakes in their companies.
PE firms have long been complaining about not being offered strategic stakes in companies they want to invest in. One has often heard them whining, "We wouldn't be interested in a small stake" or "deal sizes are small in India because of the smaller stake on offer. Promoters are not willing to give majority control."
Not anymore. Going by industry observers, PEs are now coming across promoters who are willing to relinquish the driver's seat in their favour.
Avinash Gupta, national leader - financial advisory practices, Deloitte Touche Tohmastu, says, "We are beginning to see a trend where a lot of people are having a conversation of offering a strategic stake to a PE fund. Promoters want to give a controlling stake to a PE investor."
"In some cases, the PE investor is already looking at being a strategic investor and divesting in 3-4 years when the company gets listed and getting liquidity or selling off to another strategic buyer," say Gupta. He also attributes this to people coming to terms with valuations. "They saw the two years when things went bad. Before that things were rosy. Once they are again beginning to see those valuations, they feel they will not be available later.
Shiraz Bugwadia, director, O3 Capital Advisors, confirms the trend. alt14...

More on BUSINESS & ECONOMY

Ask not whether govts will default, but how
DNMUM184075 | 9/3/2010 12:00:00 AM | Author : Vivek Kaul | WC :900

"So where do human beings go when they die?" she asked as soon I sat down on the sofa.
"Huh?" I looked at her stunned.
"Oh. I was just wondering. The rains have made me rather gloomy."
"They go to heaven

National Auto Authority will synergise govt, industry, R & D
DNMUM184090 | 9/3/2010 12:00:00 AM | Author : Sindhu Bhattacharya | WC :426

A high-powered National Automotive Authority (NAA) is being set up to primarily help improve interaction between the automobile industry and the government and should also promote more research and development work on automobiles in India.
The NAA

BC Jindal to list power venture
DNMUM184091 | 9/3/2010 12:00:00 AM | Author : Promit Mukherjee | WC :479

The BC Jindal Group, which has interests in verticals such as steel pipes and tubes, steel strips, galvanised sheets, photographic accessories, is planning to tap the capital markets for its power venture.
The group, which has three listed entiti

Nalco, Indonesian firm differ on coal supply to smelter
DNMUM184092 | 9/3/2010 12:00:00 AM | Author : Shubhashish | WC :432

A few days ago, National Aluminium Company (Nalco) advertised in Indonesian newspapers asking for companies to bid for coal supplies for its 5 lakh tonne aluminium smelter in that country. If this is true, then what happened to its deal with MEC Coal