The acquisition, the company said, was priced at Rs 105 per share. With this acquisition, GVK will now hold 29% stake in BIAL. Just last month, the company had also acquired 12%, of the total 17%, stake that Zurich Airport held in the Bangalore airport.
The price at which the L&T stake has been acquired is exactly the same at which the Zurich Airport stake was acquired. The latter was done at a cost of Rs 484.6 crore. At the time of buying the Zurich Airport stake, GVK had said it was keen on buying more stake in BIAL.
Siemens still holds the largest stake in BIAL at 40%. GVK now becomes the second highest stake holder. Zurich Airport holds 5%. The Airports Authority of India and KSIIDC, the financing arm of the Karnataka government for infrastructure projects, hold 13% stake each.
Both L&T and Zurich Aiport have made a return of over 700% on their investments in BIAL.
GVK is also the lead promoter of Mumbai International Airport. G V Krishna Reddy, CMD of GVK, said the acquisition of additional stake in BIAL is in line with “our objective of expanding GVK’s presence in the airports business”. “As BIAL embarks on the next phase of expansion, we wish to partner with all stakeholders to ensure that Bengaluru International Airport further consolidates its position as the leading airport destination in southern India,” Reddy said in a statement issued by the company. In the airports business, GVK competes with GMR Group, which controls the Delhi and Hyderabad airports.
GVK also has experience and expertise in power, roads, oil and gas and urban infrastructure. The company said it has invested over Rs 5,000 crore in its various businesses and has projects in the pipeline worth over Rs 18,000 crore.
Monday, December 7, 2009
Saturday, December 5, 2009
Corus partly closes UK facility
Corus, Europe's second largest steel maker and owned by the Tata group, will shut down TCP's blast furnace, steel mill and one of the two coke ovens by the end of January 2010. However, it plans to keep open the wharf facility, the other coke oven and some of the power generating capacity. Corus said that the partial closure will result in the loss of about 1,700 jobs, which is about 600 fewer than previously thought.
Seven-month ago, Corus had said that the broken sale contract could lead to the closure of the Teesside steel mill in northeast England. Since then, the company had been diverting internal orders to TCP apart from securing external orders on an ad hoc basis in a bid to keep the plan open, while an alternative future for the plant was sought. This, Corus says, has cost the company about £130 million. The merchant slab plant can produce 3 million tonnes per year which, according to Corus, is not sustainable without a long-term strategic partner. The plant, with a workforce of 2,300 people, accounts for about 15% of Corus' steel production capacity.
In a statement, Corus chief executive officer Kirby Adams said, “We are acutely aware that this will be devastating news for our employees,
our contractors, their families and the local community. We extend our sincere gratitude to all of them, as well as to the management team and the trade unions on Teesside, who have all worked night and day to try and avoid this outcome.''
The company would spend £80 million to close down the plant besides covering redundancies and other contractual obligations.
Corus employee unions are unhappy over the company's move and said that it would have a disastrous impact on both the company and on the UK economy.
The company will continue to have a substantial presence in the Teesside area, employing more than 2,000 people at operations in Hartlepool, Skinningrove, the Teesside beam mill and Teesside technology centre.
Seven-month ago, Corus had said that the broken sale contract could lead to the closure of the Teesside steel mill in northeast England. Since then, the company had been diverting internal orders to TCP apart from securing external orders on an ad hoc basis in a bid to keep the plan open, while an alternative future for the plant was sought. This, Corus says, has cost the company about £130 million. The merchant slab plant can produce 3 million tonnes per year which, according to Corus, is not sustainable without a long-term strategic partner. The plant, with a workforce of 2,300 people, accounts for about 15% of Corus' steel production capacity.
In a statement, Corus chief executive officer Kirby Adams said, “We are acutely aware that this will be devastating news for our employees,
our contractors, their families and the local community. We extend our sincere gratitude to all of them, as well as to the management team and the trade unions on Teesside, who have all worked night and day to try and avoid this outcome.''
The company would spend £80 million to close down the plant besides covering redundancies and other contractual obligations.
Corus employee unions are unhappy over the company's move and said that it would have a disastrous impact on both the company and on the UK economy.
The company will continue to have a substantial presence in the Teesside area, employing more than 2,000 people at operations in Hartlepool, Skinningrove, the Teesside beam mill and Teesside technology centre.
Friday, December 4, 2009
RBI to tighten monetary policy
RBI deputy governor Usha Thorat and Prime Minister Economic Advisory Council chairman R Rangarajan on Thursday indicated that in the light of rising food inflation, which has crossed 17.5%, the country should expect a tighter monetary policy.
"Clearly now going forward, the accommodative monetary stance will have to be reassessed," Thorat said. When RBI reviewed its second quarter monetary policy in October, the country was facing a fragile economic recovery, which prompted the central bank to continue with the easy stance, she added.
However, as the economy has shown a strong growth of 7.9% in the July-September quarter, RBI got the space to tighten the money supply to contain increase in food inflation, which affected the poor badly.
Thorat said RBI is looking at WPI to reach 6-6.5% with an upward bias by end of 2009-10. Rangarajan also expressed concern over the rising food prices and said it must be checked, otherwise they will push up prices of manufactured items. "Food prices must be controlled, otherwise they have a tendency to lead to manufacturing inflation. This will require monetary action by RBI, especially money supply management," he said.
OECD secretary general Angel Gurria also argued for tightening of monetary policy by RBI to contain the inflation. However, economists feel that tightening of money supply would have little impact on the rising food prices as it is directly linked with the supply-side management.
Thorat said 7.9% GDP growth in Q2 may prompt RBI to review its 6% growth projection with an upward bias in January review.
Thorat also said the Dubai crisis will not impact the country's banking sector as the exposure "is not significant and not a matter of concern...It is not something that materially affects their balance sheets."
She, however, admitted that the Dubai crisis can have some impact on remittances and affect those parts of the country that receive inflows from the Gulf nation in larger quantity.
"Clearly now going forward, the accommodative monetary stance will have to be reassessed," Thorat said. When RBI reviewed its second quarter monetary policy in October, the country was facing a fragile economic recovery, which prompted the central bank to continue with the easy stance, she added.
However, as the economy has shown a strong growth of 7.9% in the July-September quarter, RBI got the space to tighten the money supply to contain increase in food inflation, which affected the poor badly.
Thorat said RBI is looking at WPI to reach 6-6.5% with an upward bias by end of 2009-10. Rangarajan also expressed concern over the rising food prices and said it must be checked, otherwise they will push up prices of manufactured items. "Food prices must be controlled, otherwise they have a tendency to lead to manufacturing inflation. This will require monetary action by RBI, especially money supply management," he said.
OECD secretary general Angel Gurria also argued for tightening of monetary policy by RBI to contain the inflation. However, economists feel that tightening of money supply would have little impact on the rising food prices as it is directly linked with the supply-side management.
Thorat said 7.9% GDP growth in Q2 may prompt RBI to review its 6% growth projection with an upward bias in January review.
Thorat also said the Dubai crisis will not impact the country's banking sector as the exposure "is not significant and not a matter of concern...It is not something that materially affects their balance sheets."
She, however, admitted that the Dubai crisis can have some impact on remittances and affect those parts of the country that receive inflows from the Gulf nation in larger quantity.
Wednesday, December 2, 2009
Govt will sell upto 10% in PSUs: FM
"Disinvestment of government shareholding in NTPC, SJVN and REC through public offering in domestic market, is under implementation. These public offerings are likely to be completed by March 31, 2010," Finance Minister Pranab Mukherjee said in a statement in Rajya Sabha.
While in NTPC and REC, 5 per cent stake each was being off-loaded, it was 10 per cent in SJVN through the capital market, he said.
This apart, the Department of Disinvestment has started dialogue with the administrative ministries and the central public sector undertakings (CPSUs) to assess their capital expenditure requirements to be raised through issue of fresh equity in case of other public sector undertakings.
While in NTPC and REC, 5 per cent stake each was being off-loaded, it was 10 per cent in SJVN through the capital market, he said.
This apart, the Department of Disinvestment has started dialogue with the administrative ministries and the central public sector undertakings (CPSUs) to assess their capital expenditure requirements to be raised through issue of fresh equity in case of other public sector undertakings.
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