Financial sector tie-ups between India, Australia on the rise |
Sydney: Financial sector engagements between Indian and Australian firms are gaining momentum, with the possibility of market access for businesses on both sides looking brighter once the proposed Free Trade Agreement comes into place.
In a major deal in the financial sector earlier this month, Insurance Australia Group Ltd (IAG) announced the completion of an investment of AUS$ 126 million (around Rs 542 crore) for a 26 per cent stake in its general insurance joint venture with the State Bank of India for the Indian market.
The venture, SBI General Insurance Company, hopes to begin operations in the first half of 2010. IAG — Australia's largest general insurance company by premiums written — holds an option to increase its stake in the joint venture to 49 per cent, subject to regulatory and other conditions, the insurance company told the Australian Stock Exchange in a statement earlier last week. On the banking side, Australia's four major banks ANZ, NAB, Commonwealth and Westpac are all in various stages of processing applications for entering the Indian banking sector.
Meanwhile, Indian banking players are ramping up presence in Australia. Mumbai-based Union Bank of India opened a rep office in Sydney earlier this month, joining State Bank of India and Bank of Baroda, which already have a presence here. According to industry players, Punjab National Bank is also in the process of approaching the Australian Prudential Regulation Authority to set up operations in Australia.
The increasing activity by Indian banks comes a year after the world's largest bank, the Industrial and Commercial Bank of China, was granted a branch licence by the Australian regulator. Both SBI and UBI have plans to upgrade its operations through a full-fledged branch or through a subsidiary bank in the coming years to tap the opportunity arising from the upping of business engagements on both sides in light of the proposed FTA.In fiscal 2008-09, India was Australia's fastest growing trade partner, with two-way trade up 55 per cent at $21.7 billion. This is expected to see a jump once the FTA is in place, with increased market access for products and services from both countries.
Source: The Hindu Business Line |
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M&M gets into Aerospace, acquires two Aussie firms |
 Mumbai: This will enable the firm to tap the defence offset market. Automobile major Mahindra & Mahindra (M&M) has forayed into the aerospace business by acquiring majority stakes in two Australian companies, Aerostaff Australia and Gippsland Aeronautics.
Mahindra Aerospace Pvt Ltd (MAPL), in which Kotak Private Equity has also invested Rs 150 crore, will hold 75 per cent stake in each of the two Aussie companies. The remaining will be held by the existing managements. The payments will be made in instalments. Anand Mahindra, vice-chairman and managing director of the Mahindra Group, said, “M&M’s move into the aerospace segment is supported by a renewed demand for economical air transport around the world. Our investment in component capability addresses the growing needs of both civic and defence markets."
Aerostaff Australia (AA) is a component manufacturer of high-precision, close-tolerance, aircraft components and assemblies for large aerospace original equipment manufacturers. AA’s acquisition will help M&M tap the burgeoning defence offset and commercial aviation market. Gippslan Aeronautics (GA) is an established brand in general aviation and has delivered 200 FAR-23 certified planes in 32 countries (FAR 23 is a mandatory certification for fare-paying passenger carriage). Acquiring stake in GA signals M&M’s entry into the 2-20 seater, turboprop market, among the fastest growing segments in general aviation.M&M will retain the management of both companies. The auto major is setting up a plant in Bangalore to provide dual-shoring cost benefits to customers.
Source: Business Standard |
Nava Bharat to pick up 65% in Zambia
coal mine |
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Hyderabad: Nava Bharat (Singapore) Pte Ltd, a subsidiary of Nava Bharat Ventures Ltd, has signed a share sale and purchase agreement (SPA) with the Zambian government through the minister of finance and Zambia Consolidated Copper Mines Investments Holding Plc (ZCCM-IH) for acquiring 65% stake in Maamba Collieries Ltd (MCL). The acquisition entails that the initial cost of acquisition of about $26 million (approximately Rs 121.68 crore) by Nava Bharat be paid upon completion.
ZCCM Investments Holdings Plc (ZCCM-IH) is a Zambia-based investments holdings company. The majority of the company’s investments are held in the copper mining sector of Zambia. In January 2008, the government of Zambia transferred its 100% stake in MCL to ZCCM-IH. As a result, ZCCM-IH controls the Maamba coal mine, which supplies coal to Mopani copper mines and Konkola copper mines in Zambia.
The acquisition was made pursuant to the selection of Nava Bharat against a global tender issued by ZCCM in late 2008 for inducting a private majority partner. The whole process of acquisition is expected to be completed by February 2010. The SPA signed between both the entities sets out certain conditions precedent for completion of the transaction like the bankable power purchase agreement and an investment promotion and protection agreement which are critical to the proposed investment. There will be a completion audit whereby the final purchase consideration by netting the liabilities of MCL and tax assets would be ascertained.
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India leads real estate investment market in Asia
New Delhi: India leads the top real estate investment markets in Asia for 2010, according to a study by PricewaterhouseCoopers (PwC) and Urban Land Institute, a global non-profit education and research institute. The study is prepared by over 270 international real estate professionals, including investors, developers, property company representatives, lenders, brokers and consultants. The report provides development trends and outlook on Asia-Pacific real estate investment and indicates Mumbai and Delhi as particularly good destinations in India. Mumbai, Delhi and Bangalore lead in the hotel ‘buy' prospects. Also, residential properties are viewed as more promising than other sectors. “The recapitalisation by players in equity markets across Asia has been successfully replicated by some Indian developers, which has helped ease the liquidity stresses,” said Mr Gautam Mehra, India Leader for Real Estate Practice, PriceWaterhouse Coopers.
Source: IBEF |
Rs 4,551-cr FDI proposals get govt nod
New Delhi: The government has approved 17 foreign direct investment (FDI) proposals worth Rs 4,551 crore, including that of the Federal Agency for State Property Management of the Russian Federation to buy 20 per cent stake in telecom service provider Sistema-Shyam for Rs 3,051 crore. PepsiCo’s proposal for infusion of Rs 928-crore equity into its Indian subsidiary has been referred to the Cabinet Committee on Economic Affairs (CCEA), since all proposals involving more than Rs 600-crore FDI have to be referred to CCEA. The proposal of France-based Alstom Power Holdings’, Alstom Power and Switzerland-based Alstom Technology to establish two joint venture companies in India, with 51 per cent equity in one company and 49 per cent in another, has also been referred to CCEA. Other cleared proposals include those of Delhi-based Scorpios Beverages’ which would involve Rs 533.33-crore FDI and AG Mercantile to bring in Rs 329.53 crore. Besides, the proposal of Telecom Investments India for Rs 380-crore FDI was also approved. |
EMC's India investments to reach $2 bn by 2014
New Delhi: Information management and storage company EMC Corporation’s total investments in India will touch $2 billion (over Rs 9,300 crore) by 2014. The investment will mainly be in three key areas — expanding innovation capabilities, increasing support and services, and an organised go-to-market strategy. EMC recently committed an investment of $1.5 billion (nearly Rs 7,000 crore) in India over the next five years as India is the fastest growing market for the company in the Asia-Pacific (Apac) region and Japan. Apac and Japan together contribute around 13 per cent to EMC’s total revenues. The corporation began its India operations in October, 2000. The incremental investments will also go into increasing the headcount in India, which currently stands at slightly more than 2,100.
“The growth drivers for us are citizen connect projects, verticals like telecom and government, besides information growth, back-up recovery and archival, and next-generation of fully virtualised data centres, like private clouds,” says Steven Leonard, president, EMC (Apac/Japan). The company has inaugurated a Centre of Excellence facility in Bangalore, which represents one of EMC’s largest R&D centers outside the US. The newly announced investments will also go into the development and enhancement of this centre. EMC will invest in China too as it is developing rapidly and has trebled its offices there in two years. |
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