At Fis’ instance, Reliance Industries considers rescuing Spic Petrochemicals
Chennai: In a report appearing in the Economic Times, it is stated that, at the instance of the financial institutions, the country’s largest petrochemicals company, Reliance Industries Limited, has evinced interest in partly bailing out the troubled Spic Petrochemicals Ltd ( SPC), promoted by agribusiness major, Spic Industries.

According to the report both sides have also held talks to strike a deal, according to informed sources. The institutions are said to have taken this route to ensure that SPC has a strong strategic marketing partner which would add the financial strength to complete the projects that have been hanging fire for the last four years.

The report also stated that Reliance did not want to create any fresh capacity in view of the fact that it has already built a huge capacity. However, at the instance of FIs it was interested in taking over the debt portion of about Rs 600 crore, which proposal was not acceptable to SPC.

SPC, promoted in 1994, has invested the huge money in setting up ventures for the manufacture of PFY, PTA and other products. It could not go ahead and complete the projects following litigation filed by Madras Refineries ltd ( MRL) against the " competitive ventures" promoted by Spic bypassing their earlier agreement to implement them through a joint venture.

Subsequently, Spic and MRL declared a cease fire to their long legal war and MRL also decided to pull out of the JV and in September 1998 they signed a memorandum of settlement ( MoS), which is awaiting approval by the Union Cabinet.
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Wockhardt realises money from real estate, sells Bandra Kurla building to Enron
Mumbai: Months after the company moved into its swanky new headquarters building in Mumbai’s newest business district, pharma major, Wockhardt Life Science, has leased in perpetuity half its building in the Bandra Kurla Complex called Wockhardt Towers to Enron India Ltd for a massive Rs 125.75 crore.

The deal involves Enron acquiring four floors from the first to the fourth — euivalent to a built up area of 10,816 square meters — as well as interests in land and 101 car parking spaces. Wockhardt meanwhile has retained half the building from the fifth to the eighth floors — approximately 1.1 lakh sq feet — for its own corporate operations.

The deal, according to the company, was part of a Rs 140 crore project with a recovery target of Rs 100 crore through commercial sale of some of the floors.
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MSEB may pay for fixed costs in view of delay in purchase from Dabhol till September
Mumbai: Due to low demands during the monsoon period, the Maharashtra State Electricity Board (MSEB) says it will not be buying power from Enron’s 720 MW Dabhol Power Company (DPC) during the monsoons, a period of low demand. As a result of this, the power company will be forced to pay DPC the fixed costs incurred for generating power, under the terms of agreement with the company.

Luckily for the MSEB, DPC has closed down both its units for what it says is preventive maintenance, till June-end. This means that MSEB will not have to pay Rs 80 crore to Enron, the monthly fixed cost of running the units, as stipulated in the power purchase agreement between MSEB and Enron.

However, while one unit is expected to be back on stream in a fortnight and the other in a month, MSEB will not buy any power from DPC till September, when demand normally picks up.

Even when the units are back on stream, MSEB cannot necessarily purchase power from MSEB, since it is bound by the Maharashtra Electricity Regulatory Commission (MERC) directive to follow a system of `merit order purchase.’ Under this directive, after sourcing from its own generation capacities, MSEB will have to buy from other suppliers such as Tata Electric Company and Nuclear Power Corporation, rather than Enron, as they supply at lower cost. This means that MSEB will have to start paying fixed costs after the DPC units are operational.An MSEB.

The current demand of 8,800 MW (down from 11,300MW at its peak) can be taken care of by MSEB’s own generation plants.
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Telco plans to decentralise CV marketing
Mumbai: As a means of creating better customer focus between its sales and service departments, auto major Tata Engineering (Telco) is decentralising the marketing operations of its commercial vehicle business. It will now plan to market its commercial vehicles through its branch offices, as compared to the earlier situation when the marketing used to take place through area and zonal offices. The company hopes that this move will bring about a better alignment in the CV business, creating greater synergies between sales, service and spare parts.

In the earlier system, there were four regional offices. Under the regional offices there were area offices and a few zonal offices. The area offices were in charge of sales and spare parts and the zonal offices in charge of service.

In the revised policy, which is likely to take three months to implement, each state will have more than one branch office and will look after all three functions - sales, service and spares. As a result, the company will have 31-33 branch offices spread out all over the country.

The new system is also expected to bring about de-centralisation at the branch level, with each branch officer will look after a smaller geographical areas, having more responsibilities.
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Hindalco may put in bid for government stake in Balco
Mumbai: With the government having issued an advertisement, announcing the sale of 51 per cent stake in Bharat Aluminium Company Limited (Balco), Hindalco Industries Ltd, part of the A.V. Birla Group, is said to be bidding for the stake.

According to Mr. A. Agarwala , wholetime director of Hindalco, the company is open to any good growth opportunity and will look at the Balco opportunity only if it meets the company’s stringent shareholder value creation criteria.

Hindalco had recently acquired 54.6 per cent of Indian Aluminium Company Ltd (Indal) stake and has made an open offer to acquire another 20 per cent of the stake at a price of Rs. 190 per share. This offer which opened on May 26 closes on June 24. The total acquisition of 74.6 per cent stake would amount of Rs. 1,008 crores which will be met through internal accruals.
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8-9 new active pharmaceutical ingredients from Ranbaxy in current fiscal
New Delhi: With its great plans to gain a competitive edge in the post-patent regime in the country, the country’s leading pharma company, Ranbaxy Laboratories Ltd (Ranbaxy), is planning to develop at least 8-9 high value-added active pharmaceutical ingredients (APIs) in 2000.

The company has already developed and commercialised process know-hows for six APIs - celecoxib, rofecoxib, isotretinoin, lisinopril, loratadine and omeprazole magnesium - in 1999. It also filed 12 process patents in India and eight in the US on some of these technologies during 1999. The other advantage of these innovations is that RLL will be able to market such products in advanced markets soon after the expiry of the product patents there.

The Asia-Pacific region accounted for one-third of the company's API business with a sales of $32.9 million. The API business amounted to $12.1 million in Latin America where the company is planning to enter new markets such as Brazil which is the seventh largest pharmaceutical market in the entire world.
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Sandvik’s bullish plans for India
Sandiviken, Sweden: As part of its strategic vision to locally manufacture at least 50 per cent of its regional sales, Sandvik AB, the $5-billion Swedish hi-tech engineering group, is planning new investments and plants in Asia, including India.

At present the group manufactured only 25 per cent of its regional sales locally and it wanted to gradually increase it. While the company clarified that it will not go in for an acquisition spree, it hoped to increase its investments in the region substantially.

As a first step towards giving shape to its Asian vision, the group is planning to convert Singapore into a regional hub for distribution. It is hoped that this will drastically reduce delivery time to our Asian customers and give them a competitive edge in business. The company’s target for delivery of most products is twenty-four hours and it is expected that with the Singapore centre being set up, the delivery time will be further crunched.

Singapore right now plays an important role as the regional centre for technical engineering support and information technology support. It is also the Asia-Pacific logistics distribution centre for three group companies.
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Ford Motors to go it alone for Daewoo Motors bid
Detriot: Denying media reports that it was planning to join South Korean company, Hyundai Motors, in a bid for the ailing Daewoo Motors, US-giant, Ford Motor Company, stated that it plans to bid for the beleaguered auto company on its own.

The fact that joint bid was to be made was stated by Hyundai's president, Mr. Lee Choong-koo, in an interview with Reuters. A Ford spokesperson clarified this by stating that the US company plans to go it alone.

Bids for Daewoo Motor are due June 26. One or two finalists will then be selected for more extensive negotiations, with a winner being decided in September.

In addition to Ford and DaimlerChrysler, General Motors Corp and Italy's Fiat SpA have said they would like to bid for Daewoo, South Korea's No 2 automaker, which is struggling with more than $16 billion in debt.
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