Reliance Industries to divest stake in RPL
Mumbai: Pursuant to the recent budget allowing listed Indian companies to make international listings against existing block of shares, the board of directors of Reliance Industries have approved the off-loading of 13 per cent of its holding in Reliance Petroleum in favour of global oil companies and international institutional investors. RIL and its associates hold 64 per cent of RPL's fully-diluted Rs 5,200-crore equity base.

Companies were earlier required to issue fresh equity for listing shares on overseas exchanges. In its announcement on March 2, the RBI has amended FEMA to allow Indian companies to list shares on international bourses against block offerings.

The deal, as and when it goes through, will at current rates fetch Reliance Industries a windfall of Rs 3,500 crore, including capital gains of around Rs 2,000 crore. This is based on the average acquisition price of Rs. 18 at which Reliance Industries is understood to have acquired the shares.

The funds raised will be mainly utilised for expansion of RIL’s infocom project and other ventures, where the group is looking at a phased investment of Rs 14,000-15,000 crore.

It is reliably understood that the RIL stake will be divested in tranches to several strategic shareholders, like Kuwait Petroleum, Shell, ExxonMobil, Morgan Stanley and Goldman Sachs.

For the oil producers, a stake in the 27-million-tonne refinery will ensure a market for their crude oil. Though the oil will be sold at international prices, the quantity could be assured by virtue of their shareholding in RPL, industry sources said.
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Ballarpur Industries acquires Sinar Mas
New Delhi: In a move that is likely to bring about a consolidation in the highly-fragmented paper industry, Ballarpur Industries is understood to have finally clinched the deal to buy paper major, Sinar Mas Pulp & Paper India for over Rs 500 crore. The selloff move was a part of Sinar Mas’s parent’s global realignment plans.

The acquisition will help Ballarpur Industries strengthen its position as the largest paper manufacturer in India. The company will add a capacity of 1.15 lakh tons to its own capacity of 2.5 lakh tons through this acquisition.

Sinar Mas, which was seen as a threat to the domestic paper industry when it decided to enter India a few years ago, to Indian paper industry’s relief, never lived up to the threat.
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NIIT exits NIS Sparta
Mumbai: NIS Sparta, floated by software services and training firm NIIT, to impart sales training to individuals, has got out of the NIIT fold.

The software company, as part of its strategy to focus on its core businesses, sold off its 76 per cent stake in the subsidiary to New Delhi-based consulting firm IQL. The price, estimated Rs 9.7 crore ($2.1 million), was arrived at after a valuation was done by Deloitte Haskins & Sells.

The move was also spurred by the change in NIS’ business focus from retail sales training to change management in corporations, which left little synergy between the businesses of the two companies.

The remaining 24 per cent stake in NIS Sparta is held by employees and an employee stock option trust.
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Stracon scores again in sports telecasting rights
New Delhi: State-owned Doordarshan once again lost out in the sweepstakes to get the telecasting rights of big-ticket sports programs.

Private Indian media company, Stracon India, recently struck a multi-million dollar deal with FIFA for thus giving it the exclusive rights for terrestrial, satellite and DTH telecasting of the 2002 and 2006 World Cup Soccer tournaments.

Doordarshan recently lost out on the cricket front where it lost out to the ESPN-Star network combine for the telecast rights of the World Cup cricket.

This footaball deal is a quantum shift from the past where the telecast rights for Asia were being acquired by Asian public broadcasters association ABU.

Stracon India, the Delhi-based media warhorse, has reportedly quoted a double-digit million dollar figure for the FIFA rights.
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MGM to increase India presence
Mumbai: Hollywood movie production and distribution major, $1.2-billion Metro Goldwyn Mayer, which entered into a minority joint venture with Zee Telefilms last November, is exploring ways to strengthen its India presence.

According to Jules Haimovitz, president, MGM Networks , plans are afoot to launch more niche satellite television channels in the country and also step up visibility though platforms such as DTH.

He stated that MGM would launch more channels in the country. These would be niche channels like a women-oriented channel or a cooking channel. It is also likely that these channels would be in local language or Hindi.

Mr. Haimovitz said MGM, which has a library of over 1,400 movies, would like to be part of any programme bouquet on DTH platform.

He, however, reiterated that MGM did not have any immediate plans to produce movies in India.
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ACC's new unit will dampen cement prices
Mumbai: With no signs of a demand pick-up in the cement industry, the new unit of ACC Limited at Wadi which is likely to be commissioned shortly will bring in an additional 2.6 million tons capacity into the industry.

This capacity addition, analysts fear, may have a dampening effect on the prices ruling in Maharashtra and Karnataka, at least after production at the new unit stabilises.

The first dispatches from this unit is likely to hit the market by the first week of April. ACC has, however, said the dispatches will be monitored to ensure that they do not affect prices adversely.

While the new unit will take 4-5 months to stabilise, if the market demand does not pick up by then, the extra volume being generated there will have a dampening effect on prices.

Cement Manufacturers' Association, the apex body of the producers, feels that that although there has been a little improvement in demand over February, the March dispatches may end up around 10 per cent lower at around 8.5 million tonnes, against 9.5 million tonnes in March last year.
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Ortem to take Chinese head-on
New Delhi: In a rare case of Indian manufacturers taking on the Chinese, Ortem Appliances, the manufacturers of the Ortem brand of fans, is understood to have finalised a plan to compete with the Chinese ceiling fan manufacturers.

As a first step the company’s R&D division has come up with a special range, which will compete with the Chinese fan manufacturers in terms of feature, quality and price. This range is likely to be launched in Europe first and then in the Chinese market itself. China, apparently controls the entire European ceiling fan market at present and attractively prices the products between $7 and $10.

It is expected that this move will enable the company to grow in a situation where the Indian market is witnessing a negative growth of around 15 per cent.
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Interpublic combines with True North to create the largest ad agency
New York: Rival ad agencies, the Interpublic Group and True North Communications, announced that the former will take over the latter in a $2.1 billion all-stock deal. The deal will create the world’s No. 1 advertising and marketing communications concern.

The merged entity will have revenues in excess of $7.2 billion, thus pushing the new entity up the ladder to No. 1 position, replacing the WPP Group of UK.

It will give the new entity large and lucrative accounts like The Coca Cola Company, Compaq, General Motors and Samsung.

This move is part of the consolidation process that has been going on in the advertising industry over the past few years.
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Deutsche Telekom makes Net content pact
Hanover : In a move aimed at undermining arch-rival AOL, Deutsche Telekom announced its plans to run a joint online news program with one of Germany's most popular broadcasters.

Deutsche Telekom announced that its internet subsidiary, T-Online, would team with ZDF television to launch a Web news service called "heute.t-online.de."

According to company executives, T-Online's current cooperation with Microsoft's MSNBC news service will be allowed to run out before the new partnership starts in August.

This move is part of T-Online’s new strategy to stem mounting losses by keeping Web surfers on its main portal site longer with added content -- and on linking with such partners as media companies and banks to provide services that command a separate fee.

The move is expected to compete with AOL's content-based model that it strengthened after merging with media giant Time Warner.
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Pacific Internet plans to transform portal unit
Singapore: Nasdaq-listed Pacific Internet is planning to convert its portal, pacfusion.com, into an e-services arm, hoping to transform it from a cost burden into a revenue driver.

The new Pacfusion will offer other companies help in setting up their own Internet services, thus hopefully offsetting some of the huge losses the company has reported. Pacific Internet reported a loss of $6.8 million in 2000, compared with a net profit of $4.8 million in 1999.

Pacific Internet hopes to leverage the recent trend of companies wanting to offer their services online and offer the refocused Pacfusion.com site for this purpose.
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Broadcast Worldwide defers IPO
Mumbai: The Rathikant Basu-promoted media company, Broadcast Worldwide (BWW), has deferred its IPO plan and is instead going in for a third round of funding by offering part of its equity to some strategic investors.

The company, which has a project outlay of Rs. 140 crore over three years, has already raised Rs. 60 crore in two rounds of funding. The company plans to raise Rs 80 crore from this. Effectively, the company could be diluting to the extent of 57 per cent to a wide spectrum of strategic investors.

BWW had earlier planned to go in for an IPO within 12 months of its launch. However, because of market conditions, which are external to the company, the IPO has been deferred.
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