Sterlite takes over 51 per cent equity stake in Balco
New Delhi: Sterlite Industries has won the race for state-owned Bharat Aluminium Company (Balco) with the government finally deciding to offer 51 per cent equity of Balco for Rs 551.5 crore. The remaining 49 per cent equity will remain with the government. There would be a three-year lock-in period for the strategic partner and the deal will be scrutinised by the Comptroller Auditor General (CAG) once the equity is transferred to Sterlite and the money is received. The CAG report will also be tabled in the parliament.

Balco's sale is the first major strategic sale in this fiscal, and the government stake in the public sector unit will fall below 50 per cent in one go from 100 per cent. Balco has a turnover of about Rs 8,000 crore. Last year, its profit was Rs 60 crore. The company expected a profit of Rs 23 crore in this fiscal. As on December 31, 1999, the authorised share capital of Balco stood at Rs 244 crore and the subscribed capital at Rs 488 crore. Incorporated in 1965, Balco has a unit at Korba (in the Bilaspur district of Chattisgarh) and another at Bidhanbag (near Asansol in West Bengal).
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Ranbaxy and Dade to convert technical pact into JV
New Delhi: Dade Behring Inc, the US-based company and Ranbaxy Laboratories are working towards transforming the existing distribution and technical agreement into a joint venture entity. Ranbaxy Diagnostic, a division of Ranbaxy, presently distributes Dade Behring's diagnostic instruments--automated clinical chemistry analysers--for cardiac arrest, kidney transplant, liver infection and others.

Dade Behring, through the JV plans to target medium-size laboratories, along with large private hospitals and labs. For medium labs, Dade Behring plans to introduce smaller bio-chemical analyser machines, which would offer 20 per cent lower throughput and cost 15 per cent lesser compared to large machines. Presently, it is supplying its products to large hospitals and labs like Apollo, Tata Memorial, St John Medical Centre, Manipal Group, Speciality Ranbaxy and Dr Amin's Lab.

Dade Behring also wants to use the Indian technical and support centre as a hub to cater to neighbouring countries of Nepal, Bangladesh and Sri Lanka. In 2001, Dade Behring is targeting a turnover of Rs 12 crore via Ranbaxy Diagnostic.
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Millennium Alcobev to market Golden Eagle Beer
Mumbai: Mohan Meakin has signed an agreement with Millennium Alcobev for marketing nine million cases of Golden Eagle Beer and its own spirits business of over eight million cases. Golden Eagle is one of the largest beer brands in the Indian beer market of around 70 million cases.

Millennium Alcobev’s strategy is to reposition Mohan Meakin' products as contemporary and relevant while retaining its quality and taste. Mohan Meakin has not marketed its products aggressively, though it is the oldest (140 years) and one of the largest spirit and beer companies in the country. The new company is planning to put all its marketing might behind Mohan Meakin' brands.

The over-eight million cases spirit segment of Mohan Meakin includes its flagship brand Old Monk rum, which sells nearly six million cases a year. Mr. Ravi Jain, director Millennium Alcobev expects Old Monk rum sales to cross the 10 million-mark within a year.
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Vardhaman to foray into readymade segment
Bangalore: Vardhaman Group is planning to enter the readymade garment sector. The new range of products will be launched before the end of the first quarter of calendar 2002. The group is planning to enter the export market with a range of menswear, mainly shirts

Vardhaman group has a yarn producing capacity of 540,000 spindles and is a leading player in the sewing thread market with a daily production capacity of 15 tonnes. The group turnover during last fiscal was in excess of Rs 1,500 crore. Besides entering the readymade market, Vardhaman is also exploring possibility of setting up production bases in other parts of the globe notably Mauritius and South America as a part of its medium and long-term plans.

Currently fabric exports account for 15 to 20 per cent of the group’s turnover, which is projected to go up to 40 per cent by the fiscal 2003-04. The group has also planned to enter into a strategic tie-up with leading international garment makers and designer labels.
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Phelps Dodge eyeing stake in HCL and HZL
New Delhi: US-based Phelps Dodge is reportedly interested in picking up stakes in Hindustan Copper and Hindustan Zinc Ltd., two state-run firms now being privatised by the government. Phelps Dodge is the world’s second largest mining firm and is believed to have applied for registration as an interested party in the divestment of HCL and HZL.

The government last year invited bids to sell 26 per cent of its 75.92 per cent holding in Hindustan Zinc Ltd. to a strategic partner. Banque Nationale de Paris-Paribas is the global advisor for the sale. The two firms are being privatised as part of India's drive to sell major stakes in non-strategic firms together with management control.

Phelps Dodge reportedly has tied up with international metals trading firm - Metdist Trading Ltd. to jointly bid for Hindustan Copper Ltd. The government has set a minimum net worth requirement of Rs 350 crore and a turnover of Rs 650 crore for bidders in Hindustan Zinc.
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Oman Oil exits joint venture with BPCL
Mumbai: The Oman Oil Company (OOC) has decided to exit from the Rs 8,000-crore Bharat Oman Refinery joint venture with Bharat Petroleum. Mr. David C Douglas, OOC chief executive in a letter sent to BPCL has that said the decision was based on a OOC's internal study as well as a consultant's report, which found that project was unlikely to yield an acceptable rate of return.

Following the OOC decision, the BPCL has informed the ministry of petroleum and natural gas that it is now interested in going ahead with the 6 million tonne project on its own. BPCL says the Bina project is strategically vital for meeting its marketing requirements, though oil industry analysts say financing the project would be tough. The refinery, with a 943-km crude oil pipeline was conceived when the refining capacity in India was inadequate.

The project, began with the Indian and Oman governments signing an MoU to put up two refineries in India, a fertiliser project in Oman and a Rs 3,500 crore, sub-sea natural gas pipeline to transport gas from Oman to India. BPCL and OOC held 26 per cent equity each, in the project which had been stuck mainly for lack of environmental clearances. OOC, which has invested about $30 million in the project, has indicated that it will retain an equity interest equal to the ratio of this investment in the project.
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Astra Zeneca preferred for divesting ICI’s pharma business
New Delhi: ICI India, subsidiary of ICI of the UK has said that it would give first preference to its technological partner - Astra Zeneca, while divesting its pharmaceutical business in India. ICI India has been planning to exit from non-core businesses like pharmaceutical for some time.

It recently started a restructuring drive to focus on speciality products and paints to align businesses in line with the global parent, which has already sold its pharma business to Astra. The restructuring would involve moving out of pharmaceuticals, bulk chemicals and cyclicals over a period of time to fund future growth sectors like speciality food and industrial starches.

Astra Zeneca, which recently acquired 25.75 per cent stake in Astra IDL had raised controversies with ICI India to threaten to block the change of management in Astra IDL. However, ICI India gave Astra a clean chit to facilitate the takeover. ICI India’s pharma division, which contributes four per cent of the total turnover, is into cardiovasculars and anesthetics.
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Proctor & Gamble and Coke float a marketing JV
Mumbai: Procter & Gamble (P&G) and Coca-Cola have announced a joint venture company, which will market and develop both the companies' food and beverages business on a global basis. The new 50:50 joint venture company will market innovative juices, juice-based beverages and snacks, of both P&G and Coca-Cola.

The product portfolio the two companies to be marketed by the JV company is likely to include renowned global brands, like Coca-Cola Company's Minute Maid, Hi-C, Pive-Alive, Fruitopia, Cappy, Kapo, Sonfil, Qoo and P&G's Sunny Delight and Punica beverages, besides Pringles. However, none of these Coca-Cola products are currently sold in India. Pringles is the only brand that exists in P&G's food and beverage portfolio in India.

Coca-Cola India's former CEO, Don Short, has been named the CEO of the new company. The new company will focus all of its resources on becoming the global leader in innovative snacks and nutritional beverages.
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Petronet LNG for fresh bids to move LNG from Qatar
New Delhi: Petronet LNG has sought fresh bids from the four short-listed companies to transport LNG from Qatar for its proposed terminal at Dahej in Gujarat by March 31, while extending the delivery time for the two LNG tankers.

The fresh price bids have been invited from the four companies short-listed on the basis of techno-commercial bids. The bids will be decided by end of the current fiscal year.
PLL has also extended the delivery time for its two LNG tankers - January 1, 2004, for the first carrier and January 1, 2005, for the second vessel. The delivery time of the two LNG tankers of 1,38,000 cubic metric capacity each has been extended to synchronise it with the commissioning of the its five million tonne Dahej re-gasification terminal.

As per the original plan, the first vessel was to be delivered by June 1, 2003, and the second tanker by June 1, 2004, with the first consignment of LNG from Qatar being expected at Dahej by July, 2003.
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Mafatlal Industries proposes two-way split
Mumbai: Mafatlal Industries Ltd., a Arvind Mafatlal group flagship company has proposed splitting of the company into two distinct entities, as part of a rehabilitation package aimed at reviving the ailing company. MIL had been declared sick by the Board of Industrial and Financial Reconstruction (BIFR) last year. The company's core textile business has been passing through a rough patch leading to a severe working capital crunch in 1998.

The plan reportedly envisages splitting the company's textile and chemical businesses into two entities. While the chemical business is doing well, the structure of the textile division comprising five units is to be reviewed on the basis of the performance of each individual unit.

The company has posted a loss of Rs 326.49 crore and net worth of Rs 268.38 crore as on September 1999. It has loans of Rs 301.44 crore on cash credit accounts and Rs 25.89 crore on term loan accounts. Other loans and advances include Rs 100.47 crore to ICICI, Rs 30.47 crore to IDBI, Rs 31.24 crore to IFCI, Rs 10.94 crore to ILFS and around Rs 22.39 crore from others. The aggregate quoted investments stood at Rs 21.69 crore, while the aggregate unquoted investments was Rs 200.41 crore.
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