HDFC acquires Hometrust Housing Finance for Rs 50 crore
Mumbai: India’s leading housing finance institution, Housing Development Finance Corporation (HDFC), today acquired Hometrust Housing Finance Company, a 100 per cent subsidiary of Gujarat Ambuja Cements, in a deal valued at Rs. 50 crore. The company has 104 employees spread over 21 offices in the country, and has a loan portfolio of Rs. 167 crore.

Simultaneously, HDFC has also acquired 26 per cent of the equity of Gruh Finance, which was held by GACL for Rs 10 crore. The acquisition has increased HDFC’s stake in Gruh Finance to 54 per cent, making it an HDFC subsidiary. Gruh, which started operations in 1988 has a staff strength of 150 and is headquartered in Ahmedabad and has 24 offices in Maharashtra and Gujarat.

According to company sources, while Gruh Finance will continue as a subsidiary, Hometrust is likely to be amalgamated into HDFC within the next four months, subject to necessary approvals.

Commenting on the acquisition, Mr. Deepak Parekh, chairman of HDFC, said that in an increasingly competitive market, the acquisition would bring about size and economies of scale, which will ultimately benefit the customers. As a result there will be better utilisation of delivery channels and the ability to reach out to a larger customer base more efficiently and effectively.
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Disinvestment in Indian Oil may happen in April 2001
New Delhi: According to Mr Arun Jaitley, the disinvestment minister, the proposed disinvestment of 10 per cent government equity in Indian Oil Corporation is only expected around March-April next year. The minister said that the intervening period will be used to merge the stand-alone refineries in Bongaigaon, Cochin, Numaligarh and Chennai with the marketing majors in the public sector.

The cabinet committee on disinvestment, at its fourth meeting last Friday, only gave two to three months to the ministry of petroleum and natural gas to complete the restructuring process. As per the restructuring suggested by the petroleum ministry stand-alone Bongaigaon and Chennai Refinery would be made subsidiary companies of IOC by divesting the entire government stake.

In case of Cochin Refinery Ltd, the plan is to divest government holding to Bharat Petroleum and make it a BPCL subsidiary while 10 per cent stake in Numaligarh will be off-loaded to Oil India and 19 per cent equity of NRL held by IBP will be transferred to BPCL.

The government believes that this move would, apart from strengthening the stand-alone refineries in facing challenge, also help the refineries in enhancing the supply of petroleum products to IOC and BPCL, especially in south and north east India.

Government has more than 82 per cent stake in IOC. The Department of Disinvestment had proposed to divest 10 per cent of government equity.
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Control in India Gypsum changes hands
New Delhi: The UK-based BPB group, which already has a 40 per cent stake in the Birla group-company, India Gypsum, has now acquired controlling interest of the company by acquiring another 34 per cent holding from the Birla group. The entire deal is said to be valued at Rs. 19.12 crore.

As the Foreign Investment Promotion Board had given approval to the BPB group raising its stake to 74 per cent, the entire stake could not be offloaded. Hyderabad Industries still holds a 6 per cent stake in India Gypsum.

The remaining 20 per cent stake is held by the public. According to sources, the BPB group is shortly expected to file a fresh petition with the FIPB to acquire the remaining 6 per cent stake. To this effect, it has already opened an escrow account and deposited the required money in it.
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Murugappa group to restructure financial business
Chennai: In its bid to emerge as a "multi-product pan-Indian integrated financial service provider", the south-based, Rs. 3,400-crore Murugappa group is currently restructuring its financial services business.

The group’s flagship financial services company, Cholamandalam Finance, is to serve as the base for this thrust. According to company sources, the group has identified six core areas to focus on under the Cholamandalam umbrella: mutual funds, insurance, retail finance, distribution of financial products, stock broking and non-banking finance activities (including hire purchase and equipment leasing).

The group also plans to initiate a major brand-building exercise on a national level with an initial budget of over Rs 10 crore in the current fiscal. The group is also setting up several subsidiaries to focus on the stated areas of operations.

The group also plans to double its 5 lakh-strong customer base to one million in the next three years. Group company, Cholamandalam Securities, which has got membership of the Delhi Stock Exchange as well as the National Stock Exchange would concentrate on broking solutions for institutions number over 70, including mutual funds, insurance companies and banks. The company has also recently initiated development of a website for online stock broking and trading.

The mutual fund, Cholamandalam Cazenove, which manages assets of Rs 500 crore, is also looking at plugging the existing gaps in the mutual fund business with plans to launch a balanced fund and a diversified fund within the next two months.

The group’s insurance foray is also taking shape, for which it is on the verge of finalising a tie-up with French major, Axa, for general insurance in India. The group, according to sources, was open to banking also as an area to enter into in the future.
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Singhanias plan to hike stake in LML
New Delhi: The promoters of LML Ltd. propose to increase their stake in the company by making a preferential allotment of equity shares, aggregating Rs. 10 crore. With this allotment, the promoters holding in the company is expected to go up to 51 per cent from its present 47 per cent.

The price at which this preferential allotment will be made, is to be decided in accordance with the Sebi guidelines for this purpose. The board of directors of the company is to meet for this purpose on June 29.

The company has lined up investments of Rs. 120 crores in its manufacturing facilities over the next two years in this regard. This is in addition to the Rs. 350-crore investment already made in the last three years. The company is utilising 75 per cent of its installed capacity of 4,00,000 vehicles per annum. The additional capacity will initially be used to manufacture motorcycles in the current fiscal.

LML plans to launch its range of metal body four-stroke 150 cc scooters both in variator and geared versions by the first quarter of next year. These will be in three sub-variants. The company is also carrying out extensive market research for possible new product categories such as small and big wheel four-stroke scooters in plastic body as also electric scooters.
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HDFC and TCS sign pact for IT-enabled services venture
Mumbai: India’s leading housing finance institution, Housing Development and Finance Corporation (HDFC) and leading software services company, Tata Consultancy Services (TCS), today signed a memorandum of understanding (MoU) to set up a 50:50 joint venture to offer IT-enabled services overseas.

The joint venture will offer a spectrum of IT-enabled services (ITES) including online information and help support through call centres, relationship management and back-office data processing. The joint venture plans to market its services to various international clients in the US and other developed countries. The two partners, project the revenues for the joint venture at Rs. 50 crores in the first year, Rs. 130 crores in the second year and Rs. 300 crores in the third year.

The company proposes to set up its operations in Mumbai and Chennai and plans to commence client servicing in four months' time. The scope of services would be expanded in the years to come to include services such as data conversion and Web content development, company officials said.
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Magal of Israel bags Reliance Petroleum order for security systems
New Delhi: Magal Security System Ltd. of Israel, the world's largest company in perimetre security systems, has been awarded the contract from Reliance Petroleum Ltd. to provide sophisticated electronic security and surveillance systems at its refinery in Jamnagar.

Magal, which also has advanced defence related security systems, is also said to be in talks with the Indian government and public sector utilities for installing security systems at India's borders, power projects, oil reservoirs and airports.

Magal also plans to make presentations to the Indian government on the need to install sophisticated security systems at high risk prisons, especially those where militants and dreaded criminals are kept. Magal has installed its systems at over 300 prisons in the US.
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