ICICI drops plan to sell old building to Ketan Parekh
Mumbai: Ketan Parekh’s arrest has had a number of side effects. Among them is the sale of ICICI's south Mumbai offices to the Ketan Parekh group companies, which has fallen through. The company will have to find new buyers or retain the premises for its own use.

ICICI had announced in October last year that it would sell 7 floors of the ICICI Main Building, with a total built up area of 48,445 sq. ft., at Backbay Reclamation in South Mumbai for Rs 73.10 crore to the Ketan Parekh Group of companies.

Under the proposed deal ICICI was to retain the land and the ground floor, which is occupied partly by ICICI Bank and partly by Central Bank of India.

ICICI had put its old headquarters on the block last year after most of its departments shifted to its hi-tech building in the Bandra-Kurla complex — the new business district in central Mumbai last year.
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Microsoft gets into Web music
Seattle: Microsoft is launching an Internet music broadcasting service, which it hopes will lay the foundation for offering music downloads or online music subscriptions.

Microsoft’s announcement came two days after RealNetworks, Microsoft’s top rival in the Internet media field, unveiled a deal with three major record labels to start an online music subscription service.

The move to subscription services is gaining momentum following the legal battle between the major record labels and the wildly popular Napster service, which allows Internet users to copy digital music files from each other’s computers.

The record companies won a federal court injunction that requires Napster to block copyrighted songs.
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Zee postpones launch of Chakra
Mumbai: Chakra, the organic channel of Zee Telefilms, will now be launched by June of this year instead of April as scheduled earlier. Channel head Alok Dutta said there could be delay of couple of months in the launch of channel and did not rule out a simultaneous Indian launch of the channel.

Chakra is targeted at Indian diasporas and Western audience, and tries to fill an increasing western demand for ancient Indian values and products. It will initially target markets in the United States and United Kingdom.

To begin with, the channel will run for 12 hours with four hours of original programming. This will be extended to 24-hours over a period of time, executives in Zee said.

The focus of the niche infotainment channel would be on the wealth of ancient knowledge available in India in the form of scriptures, herbal medicine, Organic farming and spiritualism.
Chakra would work on pay-subscription model in the UK and US markets. E-commerce from products and consultancy would be the other sources of revenue.

Earlier Zee had announced that it would invest Rs 200 crore over the next three years in the new channel with the target to break-even over a five-year period. Channel executives said the funds were expected to come through internal accruals.
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Pentamedia subsidiary launches kids channel
Chennai: Pentamedia entertainment business is expanding day by day. The highly diversified entertainment company is now launching a satellite kids channel via its wholly owned subsidiary - Intelivision.

The free-to-air English channel to be launched on May 1, 2001 will have Hindi and Tamil bands for the respective markets. The channel is targeting children in the age groups of 4 - 14 years and will be uplinked from Chennai, either through VSNL or Sun TV’s Teleport.

Pentamedia, the parent company is funding the venture and is estimated to incur an annual expenditure of Rs 20 crore for the first two-three years. Intelivision expects to clock revenues to the tune of Rs 17 crore, including Rs 14 crore from advertisements, in the first full year of operations.

The channel will position itself as a fun, information and a young channel. It will also provide programs for career development, both curriculum based and informal education. It will have cartoons, intelligent game shows and other programs that will enrich children.
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Mondeo may be launched by Ford India
Mumbai: Ford India, the Indian subsidiary of Ford Motor Co. the world’s second largest automobile maker, has chosen Mondeo, the luxury sedan, for making its foray into the premium 'D' segment later this year.

Though the company is tight lipped over the issue, reliable sources say that Mondeo is being launched to take on the Honda Accord and Hyundai Sonata, also to be on the roads over the next few months.

The Ford Mondeo, would most probably be imported by Ford India and carry a price tag of Rs 13-15 lakh and will have an engine capacity of over 2 litres in India.

Ford India, which sold 4,849 units of the Ikon in March, including exports of 2,198 units, has captured a marketshare of 28 per cent in the mid-size segment. With increasing focus on export markets including South Africa and Mexico, the company has more than doubled its sales last month.

Meanwhile, Ford Motor said it was not interested in acquiring the Indian government’s 50 per cent stake in Maruti Udyog. Maruti Udyog is an equal stakes joint venture between the government and Suzuki Motor of Japan.
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Revamp package for Indian Hotels gets RBI nod
New Delhi: The Indian Hotels Company, IHCL, a Tata Group Company said it had secured the Reserve Bank of India approval for a comprehensive restructuring package for Taj Lanka Hotels and Taj Maldives by creating a new joint venture to be based in Hong Kong.

A comprehensive settlement with the lenders of Taj Lanka comprising a consortium of banks, namely, State Bank of India, Canara Bank, Bank of Baroda and Bank of India, has also been reached, it said.

Under the settlement, IHCL would invest an additional amount of $4 million in the equity of Taj Lanka along with a term loan of $1.5 million to be provided to the company on arms-length basis to partly fund a full and final settlement with the lenders.
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Saurashtra Cements does not find suitors as they fancy L&T deal
Mumbai: The Mehta group’s plan of roping in strategic partners for its cement companies, Saurashtra Cement and Gujarat Sidhee Cement has fallen through as possible suitors, which includes cement transnationals, prefer to wait for a cement deal at Larsen & Toubro before committing themselves to the Mehta group firms. This was confirmed by Mehta group vice-chairman Jay Mehta.

Industry analysts say the Mehta group companies will only be in a second option for Lafarge, Holderbank and Cemex, who are currently conducting a due-diligence of L&T’s 16 million tonne cement business.

L&T, which will be offering up to 26 per cent of stake to a strategic partner in its cement subsidiary, is likely to finalise the disinvestment by end May or early June, sources close to the deal said.

The Mehta Group on the other hand is ready to divest up to 50 per cent of the promoters’ stake to a strategic partner with immediate effect. However, the management is clear that it will not offer a majority stake to the partner.

Close to a dozen firms, including international cement majors like Lafarge, Cemex and Grasim have shown interest in joining hands with the Mehtas to pick up stakes in Saurashtra Cement and Gujarat Sidhee Cement.

Saurashtra Cement and Gujarat Sidhee Cement, with a 30 per cent marketshare in Gujarat, have access to large reserves of high quality limestone. Although the cement companies have not been doing well financially, analysts say that the interest shown by suitors in the two firms is because of the limestone reserves and their strategic marketshare in Gujarat.

In the last fiscal Saurashtra Cement recorded a loss of Rs 40.05 crore on a sales turnover of Rs 168 crore. Gujarat Sidhee, which has slipped has been referred to BIFR, posted a loss of Rs 54 crore during the period.
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Reliance joins war for cricket sponsorship
Kolkata: There is a swadeshi brand war in the offing in cricket sponsorship with the exit of ITC in sports sponsorship. Reliance, Sahara and Hero Honda have joined the race with the Tatas to be the official sponsors of the Indian cricket team.

The Board of Cricket Control, of India, BCCI, is keeping proposals from multinational consumer electronic giants such as LG Electronics and Samsung at an arm’s length. It is believed that the board prefers an Indian logo adorn the shirts of Indian boys.

According to sources handling the sponsorship bids put in by different corporate houses, BCCI prefers an Indian company to replace ITC Wills Sport Cricket sponsorship as it represents "a true Indian brand."

ITC decided to withdraw from sponsoring the Indian cricket team through its Wills Sport Cricket brand after the government announced a ban on tobacco money in advertising. ITC, however, continues be the official sponsor of the Indian cricket side, through its WelcomGroup Hotel brand. ITC has said it will continue to do so till a replacement is found.
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Dabhol Power serves arbitration notice served on Union govt
Mumbai: The Union government has been served with an arbitration notice by the Dabhol Power Company (DPC) for not honouring the Centre’s counter-guarantee, invoked by it for the Rs 102 crore December, 2000 bill.

The notice was served on Wednesday. "DPC, in consultation with our partners, has decided to commence the dispute resolution process under the provisions of the Government of India counter-guarantee. We have issued a notice of conciliation and a notice of arbitration for the overdue amount of Rs 102 crore of the December bill. This step was necessary in order to preserve our rights in the project, and to ensure that all parties honour their existing contractual obligations," a DPC statement said.

Under the terms of the power purchase agreement (PPA), any dispute between DPC and the state government or the Centre can be resolved in the London Court of Arbitration (LCA).
It all began when DPC invoked the counter-guarantee on March 8, 2001 for the Rs 102 crore bill that MSEB was required to pay for December 2000.

Earlier, DPC had invoked the state government guarantee but the Maharashtra government had failed to honour it.

MSEB took the stance that the December bill would be adjusted against a penalty of Rs 400 crore that it slapped on DPC for non-supply of power for intermittent periods between October 2000 and January 28, 2001.

As this was contested by DPC, the centre referred the matter to the Union law ministry, which agreed that both sides had a case.

The centre on Monday wrote to DPC and said that it does not intend to honour the counter-guarantee till the Rs 400 crore penalty issue was resolved. This has triggered off the latest response from DPC.
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IFC picks up a 20 percent stake in Mahindra Realty for Rs 46 crore
New Delhi: The US-based World Bank subsidiary, the International Finance Corporation (IFC), is picking up a 20 per cent equity stake in Mahindra Realty and Infrastructure Developers Ltd for Rs 46 crore.

This investment comes shortly after Mahindra Realty bought the 6.34 per cent stake held by IFC in Gesco Corporation, another real estate company, for Rs 8.02 crore. This acquisition was in addition to the 10.5 per cent stake of the Dalmias in the same company, which ended the tussle between the Dalmias and the original promoters, the Sheths, for control of Gesco.

Mahindra Realty is in the business of developing, promoting and managing infrastructure projects in select sectors. It has invested in real estate projects in Mumbai, Chennai and Punjab.
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UB to sell 26 percent stake to strategic investor
Mumbai: United Breweries has decided to divest 26 per cent of its stake to a strategic investor.

"We will offload 26 per cent stake to an international beer company," group chairman Vijay Mallya said at a press conference.

Mr. Mallya said that the purpose of the divestment was to enhance shareholder value. Besides which a foreign player could bring in well-known brands into India. At the same time he ruled out the possibility of lowering his personal stake in United Breweries from the present 50 per cent level.

In the past, Belgian brewery major Interbrew, Carlsberg and Heineken have shown interest in the company and according to company officials, the possibility of any of these three firms emerging as a potential partner was still there.

Mallya said UB was looking for a foreign partner who would support its moves to expand the global market for the Kingfisher brand, besides helping it capitalise on its dominant position and providing a major international beer label to Indian consumers. A tie up with UB would also be advantageous for foreign players as they would be able to leverage on UB’s production capacities and its vast distribution network.

The company has appointed Kotak Mahindra Capital Company as its advisor for the purpose. The deal is to be completed during the current financial year.
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Cipla enters into a tie up with Zenith Goldline, United Labs of US
Mumbai: Indian pharmaceutical major Cipla has tied up with the US-based Zenith Goldline and United Research Labs for marketing Flutamide, an oncology drug, and Felodipine, a cardiovascular drug, in the US and European markets. The patent of Flutamide goes next month, while the patent for Felodipine expires in late 2001.

The patent of the drug is currently held by the US-based drug major Schering Plough.

Cipla has already initiated manufacturing of the generic version of Flutamide.

Senior officials at Cipla said, "The manufacturing and international marketing operations of Flutamide will commence in the latter half of the year. We have tied up with Zenith for marketing it in the US and in the European markets."

The oncology market in the US is estimated to be over Rs 600 crore. According to analysts, Cipla expects a topline growth of 35 per cent in the current financial year. Asthma and cardiology are going to be the niche segments for the company's growth.

The domestic formulation sector, which is growing at the rate of 20 per cent, will contribute around 40 per cent to the total sales of Cipla in 2000-01.
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Mirc’s plans to divest 30 percent to FIs falls through
Mumbai: Mirc Electronics’ plan to divest a 30 per cent stake to financial institutions has fallen through.

Both Unit Trust of India (UTI) and Life Insurance Corporation of India (LIC), to whom the offer was made, have turned it down.

Senior Mirc officials said, "We have not yet received any intimation from the institutions and so, it appears, the proposed stake dilution will not materialize."

It appears that UTI and LIC are not keen on picking up the stake because of the recent stock market crash. According to other sources in the financial institutions, the institutions are not comfortable with the consumer electronics sector.

Earlier Mirc had proposed to raise Rs 150 crore through a preferential issue of 30 lakh equity shares to financial institutions.

The company proposed to issue 20 lakh shares to UTI and 10 lakh shares to LIC at approximately Rs 550 per share. UTI currently holds a negligible stake in the company while LIC holds none.
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Ramco clinches multi-million deal with Boeing for aviation solutions
Chennai: The Chennai-based information technology solutions provider Ramco Systems on Wednesday announced a strategic partnership with aviation company Boeing, US, to provide enterprise maintenance solutions to the global aviation and transportation industry.

The partnership will be for a period of 15 years and could lead to revenues of between $150 million and $600 million over a five-year period. Initially 150 professionals would be employed which would ultimately grow to 1,000.

Mr Lakshmi Narasimhan, president, Ramco Systems Ltd, said at a press conference held here on Wednesday that the revenue would be shared between the companies and would depend on the nature of work carried out.

A news release issued earlier by Boeing in Seattle, USA said "In a move to further expand its digital services, the Boeing company has entered into an alliance with Ramco Systems Ltd to complete a new software offering called Enterprise One, a comprehensive maintenance management system for airlines."
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HCL Comnet to offer digital signature tech solutions from RSA securities
New Delhi: HCL Comnet, an enterprise networking company of the HCL group, has entered into a tie up with the US-based RSA Securities to offer digital signature technology solutions in India.

The company will offer RSA's digital signature solutions branded as `Keon' along with implementation services for deploying the system. The services will be targeted at the new breed of certifying authorities (CAs) for digital signature, coming up in India.

The Controller of Certifying Authorities has recently invited applications from companies to become CAs of digital signatures and it is expected that around 50 companies will apply for licences this year.

According to industry experts, the average setup of digital signature system will cost anything between Rs 5 crore and 10 crore and even if 25 per cent of applicants set up their infrastructure this year, it will turn out to be a market worth around Rs 100 crore.
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Ashok Leyland bags orders for 2,000 CNG vehicles
Chennai: Good times may be here again for commercial vehicles major Ashok Leyland Ltd. As of March end the company (ALL) has received orders for 2,051 CNG vehicles. Of this, 1,431 units belong to private operators and the balance is from Delhi Transport Corporation (DTC). The company says that orders are still coming but in small numbers.

The order flow started after the Supreme Court in the ‘Delhi vehicular pollution prevention case.’ permitted operation of diesel buses in the capital after April 1, 2001 only if the relevant operators placed orders for CNG vehicles by March 31, 2001. With their ability to operate buses now directly linked to the placement of firm orders for CNG vehicles, private players finally began to place orders towards the end of March.

Industry players say that only a small portion of the existing fleet has come up for replacement. DTC operates 2,000 buses and the State Transport Corporation has placed orders for almost its entire fleet. However considering that the quantum of private buses plying in the capital is anywhere between 8,000 and 12,000 units, it appears that most private operators are yet to decide on the course of action that they will have to take with regard to this issue.
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Tatas integrating operations of their communications companies
Mumbai: The Tata group communication companies- Tata Communications Ltd (part of Birla Tata AT&T), Tata Teleservices and Tata Internet Service Providers (Tata ISP), are integrating operations and working in coordination, so as to leverage the maximum benefit from their individual capacities.

This policy is in line with the earlier strategy whereby the information technology companies - Tata Consultancies Ltd, Tata Elxsi, Tata Infotech and and Tata Technologies, will follow a policy of integration of operations while maintaining individual identities.

As a strategy, this coordination is advantageous as all these companies deal with operations they share synergy like basic telecom service, cellular service and Internet service provider. The objective of this exercise is to consolidate operations in such a way, that companies growing at a faster pace should not come in the way of the other's growth.

While it will help them avoid duplication of projects undertaken and services provided, the companies can take advantage of mutual expertise for meeting respective clients requirement. Another implication of such an arrangement will be to cut extra cost incurred in accessing external help for meeting respective client requirement.
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Bayer buyout of CropSciences could spawn mega corp in India
Mumbai: Bayer AG's proposed acquisition of Aventis CropSciences might augur the emergence of a Rs 750 crore agrochem powerhouse in India.

Manfred Schneider, chief executive, Bayer AG on Tuesday said that he was examining a proposal from Aventis, which is seeking to spin off CropSciences to concentrate on its core pharmaceuticals business.

Analysts say that almost 50 per cent of Bayer India's sales of roughly Rs 638 crore comes from its agrochem business, while Aventis CropScience India boasts of sales of around Rs 400 crore. The combined market share of both companies would be in the region of 24 per cent. Bayer India is targeting a growth rate of 15 per cent in the agrochem segment and this when backed by Aventis CropScience's aggressive growth plans will change the Indian scene significantly," an analyst said.
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SAIL will be recast into two SBUs
Kolkata: On the recommendations made by US consultancy McKinsey &Co, Steel Authority of India Ltd (SAIL) is recasting its plant-based structure along the lines of subsidiary business units, which will have consequent top management changes.

This will be after it tries out the product focus successfully at its central marketing organisation.
In the changed setup, the four integrated steel plants of SAIL will not be run by managing directors (MD) who are also on the main board. An executive director-in-charge will head each of the plants -Bhilai, Bokaro, Durgapur and Roukela. Up to the mid-seventies, the integrated plants were headed by general managers and then by MDs who were members of the board of SAIL. In the new setup, the executive directors in charge of the plants will not be on the board.

SAIL has already recast its board, effective April 1, based on the directives of the Securities & Exchange Board of India that half the members of a company's board should be non-functional directors.

SAIL has at present 20 directors on its board. In the next few months, it will form two subsidiary business units (SBUs) - one each for flat and long products.

McKinsey has suggested that the Bhilai and Durgapur plants, along with the long products group of the CMO, form the long products SBU headed by a director.

Bokaro and Rourkela steel plants along with the flat products group of CMO should form the flat product SBU headed by another director.For many years SAIL has enjoyed a monopoly in a controlled market. The situation changed with the opening up of the economy. Customers now dominate the steels market.

Though SAIL has reported a handsome rise in net sales realisation in 2000-2001, further gains in market realisations and profitability will depend upon how well the plants are able to meet the demands of the market. This could mean closer tolerances and specifications required by customers, as well as sharp cuts in production cost.
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