1. Jet on a Wing and a Prayer as Etihad Seeks to Fly Out
Jet Airways’ financial problems took a turn for the worse on Tuesday, 19 March, with partner Etihad formally asking State Bank of India to purchase its stake in the airline and the pilots’ union threatening to strike work from 1 April if salary arrears are not cleared.
The Abu Dhabi-based airline, which owns about 24 percent in Jet, has been a reluctant participant in discussions to resolve Jet’s financial woes. Etihad conveyed to SBI its decision to exit Jet in a meeting on Monday.
People close to the situation said Etihad wants SBI to buy out its stake and also take over its liabilities in the form of a guarantee for Jet’s loan from HSBC Dubai. Etihad has also offered its 50.1 percent stake in Jet Privilege to SBI.
(Source: The Economic Times)
2. Korean Firms Hyundai & Kia Book a $300-m Ride in Ola
Ola has raised $300 million from Hyundai Motor and Kia Motors as the homegrown ride-hailing platform looks to collaborate with the South Korean auto companies to build India-specific electric vehicles and other mobility solutions.
The investment is part of Ola’s current financing round, which is estimated at $500-600 million. For Hyundai and its affiliate Kia, this is their second bet on the ride-hailing segment globally after backing Singapore-based Grab last year with a $250-million investment.
The Economic Times had reported on 8 March that Hyundai was in advanced discussions to invest $250-300 million in Ola.
Hyundai was to pick up a four percent stake in the Bengaluru-based firm for a valuation of about $6 billion, the highest that the Bhavish Aggarwal-led company has commanded thus far.
(Source: The Economic Times)
3. Realty Firms Can Opt for Old or New Rates for Ongoing Residential Projects
Real estate developers can opt for a lower rate of GST (Goods and Services Tax) without Input Tax Credit or go for the the existing rate with the ITC.
This applies to ongoing projects (buildings where construction and actual booking have both started before 1 April 2019). Projects beginning on or after 1 April will fall into the lower GST rate regime automatically. A decision to this effect was taken by the GST Council at its 34th meeting on Tuesday.
Briefing media persons after the meeting, Revenue Secretary AB Pandey said the Council has approved a transition plan for the new rate structure for real estate residential projects.
(Source: The Hindu Business Line)
4. L&T’s New Tactic in Mindtree War: Charm Offensive
Top executives of Larsen & Toubro resorted to charm in an attempt to win over the irate promoters of Mindtree, a day after mounting a hostile takeover bid for the Bengaluru-based IT services firm, even as both sides clung to their positions in an extraordinary acquisition battle that marks a first for India’s $150-billion IT outsourcing industry.
“We are looking at Mindtree with pyaar (love) and want to do this deal from our dil (heart),” said SN Subrahmanyan, CEO, L&T, on Tuesday.
“There are certain emotions and trepidation involved, but business is business. Emotions do play a part, but have to be overcome as we go forward,” he told reporters.
The board of Mindtree is scheduled to meet on Wednesday and discuss a share buyback that is under threat after the open offer made by L&T on Monday.
(Source: The Economic Times)
5. Don't Make it a Prestige Issue, NCLAT Tells RBI Over IL&FS NPA Rule
The National Company Law Appellate Tribunal (NCLAT) on Tuesday admitted the Reserve Bank of India’s (RBI’s) plea seeking modification of the 25 February order of the appellate tribunal in which it had said the group companies of Infrastructure Leasing & Financial Services (IL&FS) would not be classified as non-performing asset (NPA) by banks without prior approval.
Asking the RBI not to “make it a prestige issue”, the NCLAT observed that the central bank should cannot restrict the appellate tribunal from passing orders in the issue.
The RBI approached NCLAT seeking to implead itself as a party in the ongoing IL&FS case and said the orders passed by NCLAT on 25 February would lead to a “situation where statutory instructions/guidelines/circulars issued by the Reserve Bank of India become infructuous”.
(Source: Business Standard)
6. Singh Brothers Barred from Selling Assets
The Securities and Exchange Board of India has barred brothers Malvinder and Shivinder Singh, former promoters of Fortis Healthcare, from selling any of their assets till they, along with other companies associated with them, pay back ₹403 crore loan along with interest that were diverted from the hospital chain.
Sebi has directed the Singh brothers not to associate with the affairs of Fortis Healthcare and Fortis Hospitals.
Sebi has also barred Religare Finvest from disposing of or diverting any funds without its prior permission.
(Source: The Economic Times)
7. Airbnb in Talks With OYO to Put $100-200 Million for Minority Stake
Even as SoftBank-backed OYO’s Chief Growth Officer Kavikrut told Financial Express Online last month that Airbnb could be a “potential partner” to them, the latter is looking to back OYO to focus on the hotel business.
This would give Airbnb a significant access in the affordable hotel segment in India (where OYO claimed to be the seventh largest chain of hotels) and China. The company had acquired the US-based hotel booking platform HotelTonight for reportedly around $400 million.
Airbnb is currently in discussions to invest in OYO and is likely to put $100-200 million. The Information is reported citing two people familiar with the matter.
(Source: Financial Express)
8. Aries Group Plans $1bn Foray into Petrochem Business in Kuwait
NRI industrialist-run Aries Group is planning to foray into offshore oil, gas and petrochemical business in Kuwait. It will invest $1 billion to fuel its robust growth project. Last year, the group’s Indywood consortium had initiated a $10 billion investment in India in the entertainment business.
Last year, the group’s Indywood consortium had initiated a $10-billion investment in India in the entertainment business.
“We are looking at broadening our horizon in global oil, gas and petrochemical industry. We are looking at an additional investment in Kuwait,” Sohan Roy, Aries Group chairman, announced at the Kuwait Symposium.
(Source: Financial Express)
9. Top PEs in Talks to Buy DHFL Bonds
KKR & Co, Baring Private Equity (Asia), SSG Capital and US-based Peregrine are among the global buyout firms that have held separate talks to purchase outstanding bonds in Dewan Housing Finance (DHFL), pointing to shortening odds on the revival of the stressed home financier.
These global investors are understood to have approached some high-profile funds that own the bonds, multiple sources with direct knowledge of the negotiations told The Economic Times.
“Talks are focused on discounts of 15-30 percent as select investors holding these bonds want to improve their cash positions,” said one of the sources mentioned above. “It is time for some tough bargaining.”
(Source: The Economic Times)
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