Modi Mundipharma Forms JV with Omega Pharma

Delhi-based Modi Mundipharma has formed a 50:50 joint venture (JV) with Belgium-based company Omega Pharma to sell the latter’s over-the-counter (OTC) medicines in India and manufacture on-contract drugs for the Belgian company’s overseas markets. The two companies plan to launch 15 OTC medicines and eight medicines between October 2009 and April 2010. These include Omega’s best-selling medicines, Silence (anti-snoring), Cellasaene (anti-slimming) and Salvecol (cholesterol reducer), among others. The two companies would invest e2 million and hire 75 people in its sales team to sell the products in the market, which will be scaled up to around 200 in the next five years.

Source: Economic Times

Gulf Air to cancel Jet lease deal

Bahrain's national carrier Gulf Air has walked away from a deal to lease four Boeing 777 aircraft from India's Jet Airways, citing economic conditions. Gulf Air said it had an option to lease the aircraft after an existing six-month contract expires, but has decided not to go ahead, the Gulf Daily News reported. "After careful analysis of various commercial and other business considerations, Gulf Air has decided not to pursue the dry lease option for the foreseeable future," the daily quoted the airline as saying. Dry leases are contracts under which airlines lease planes without staff. Gulf Air said in February it had agreed to lease four Boeing 777s as part of its efforts to replace its fleet. The existing six-month contract is a wet lease agreement, which typically includes staff. Meanwhile, Gulf Air has placed a $270 million order for CFM56-5B engines to power 15 new Airbus A320 family aircraft. The aircraft are scheduled for delivery between 2009 and 2013. The carrier has also signed a 10-year On Point Solution agreement of $100 million with GE Aviation for the maintenance, repair and overhaul of the engines. "Selecting the CFM56-5B engine demonstrates our continued trust and confidence in this product's excellent technical capability," said Gulf Air chairman Talal Alzain.

Source: Business Standard

Bharti, Alcatel in $500 mn deal for network mgt

Telecom major Bharti Airtel today signed a five-year managed services deal valued at $500 million with Alcatel Lucent for its fixed-line and broadband operations. The services would be managed by a joint venture in which Alcatel Lucent would hold 74 per cent, while the remaining 26 per cent would be held by Airtel, Bharti Airtel Chief Executive Officer Manoj Kohli said.
The JV would be run by Alcatel Lucent with 4,000 employees, some of whom would come from the network management firm. "The JV will manage Airtel's fixedline and broadband services," Kohli said. Bharti has already outsourced its network management to Nokia Siemens and Ericsson in two different deals for its wireless business while its IT infrastructure is managed by IBM.

Source: Business Standard

Adani Power inks transmission deal with Siemens

Adani Power, a part of the Adani Group, today awarded Siemens, a Rs 1,380-crore contract for transmission of power from its Mundra power plant to Mohindergarh in Haryana. As per the contract, Siemens Ltd and Siemens AG will install a bipolar 500-kilovolt high voltage direct current (HVDC) transmission system of 2,500 MW capacity. "We have signed a contract of Rs 1,380-crore with Siemens to transfer power over a distance of around 1,000 km from our Mundra power plant to Mohindergarh.The HVDC technology used by Siemens is much superior than the traditional one," Adani Enterprises CEO (Power), R K Madan, told reporters here.
The dedicated HVDC power transmission is more cost- effective and energy-efficient compared to the conventional AC power transmission lines, he said, adding, "the transmission losses would also be lesser as power is transmitted in the form of direct current." The first phase of installation of HVDC transmission system would be completed by February 2011 and the second phase in July 2011, Madan said. Adani Power is setting up a 4,620 MW thermal power plant at Mundra with its first unit to be commissioned in May-June this year, he said.

Danone Group wants to invest Rs 350cr over 5 years

The Danone Group has told the Foreign Investment Promotion Board (FIPB) that it proposes to invest Rs 300-350 crore over the next five years. It will invest in medical and nutrition sectors in India directly or indirectly via joint ventures (JVs). The group will further invest in baby food, dairy and beverages, it said. It has received a no objection certificate (NOC) from Britannia as well as from Avasthagen and Yakult joint ventures. The Danone Group currently holds 4.21% indirect stake in Avasthagen and has a 50:50 Indian JV with Yakult, Japan. It has sold its stake in Britannia to the Wadias this month.

Source: Moneycontrol

UTV Motion Pictures ventures into Hollywood

UTV Motion Pictures has signed a foreign sales deal with Madrid-based film sales company 6 SALES, for the Heather Graham starrer, ExTerminators. UTV through its foreign sales partner has already inked deals for Romania, Benulux and Middle Eastern territories. The movie, directed by John Inwood, stars Heather Graham, Jennifer Coolidge and Amber Heard. It is a dark comedy about Alex (Graham), a lonely accountant whose sole act of rage results in her being sentenced to court mandated rage therapy. There she meets Stella (Coolidge), the owner of a small extermination business who uses her car as a weapon; and Nikki (Heard), a dental technician with the face of an angel and the mind of a sociopath. Together these unlikely friends form their own 'silent revolution'. Commenting on the deal, Lokesh Dhar, Vice-President, UTV Motion Pictures, USA said, "With Exterminators, we look forward to strengthening our base in the international markets. After our international co-productions such as The Namesake, I think I Love My Wife and The Happening, ExTerminators is UTV's first independent production in the US and is definitely a landmark for us, as well as the Indian film industry." "The public's response is exactly what we had hoped for: uncontrollable laughter," said Marina Fuentes, 6 SALES partner. "We believe this type of movie is what the audiences are looking for. Good fun entertainment, " she added. The film premiered at SXSW (South by South West) festival in Austin, one of the top film festivals in the US to packed theatres.

Source: Moneycontrol

Philip Morris, Modis settle Marlboro row

US tobacco giant Philip Morris and its Indian joint venture partner, the KK Modi group, have decided to settle their dispute over the sale of Marlboro cigarettes in India, in what is being seen as a tactical retreat by both companies keen on gaining market share. The board of Godfrey Phillips India (GPI), where the two firms own a 36% stake each, decided on Saturday to start negotiations with Philip Morris to market Marlboro through the GPI distribution network in India. The two companies had clashed in 2003 after Philip Morris bypassed its Indian partner and struck an arrangement with a local distributor to sell Marlboro in India. The US company had said at that time Marlboro, its iconic brand immortalised by the picture of a cigarette-toting cowboy, was too precious to be given to a company not controlled by it. The subsequent thaw and Saturday’s decision to bury the hatchet is being attributed to a serious deterioration in GPI’s competitive position and the ever increasing dominance of ITC, part owned by British American Tobacco, Philip Morris’ big global rival. India’s 96 billion sticks-a-year cigarette market is dominated by ITC with about 65% share. GPI’s Four Square, Jaisalmer are small players in the premium segment, which itself comprises 60% of the total market. KK Modi, chairman of the company, declined to comment on Saturday’s board decision, but a person close to the devlopment said the move is largely to combat ITC’s hegemony. “The standoff has not helped either GPI or Philip Morris’ plans in India. Marlboro will add to GPI’s portfolio a high-end brand with strong consumer pull which it always lacked. The board has been formally informed about discussions with Philip Morris, but this does not imply that a deal has been finalised,” said the person, requesting anonymity. GPI shares jumped 20% or Rs 166.25, to close at Rs 997.60 on BSE. In January last year, ET had first reported about early talks between GPI and Philip Morris to cut a marketing and distribution deal for Marlboro. Although an executive close to the development said that Marlboro will be imported and marketed in India, another person familiar with the matter said that Philip Morris International has already done due diligence on two GPI plants in Mumbai and Ghaziabad, suggesting that the deal may involve local manufacturing of Marlboro. While the government will not allow any expansion in production, the person said that GPI had idle capacity as cigarette production declined during FY09, with firms stopping production of non-filter cigarettes due to the high excise duty. Philip Morris is likely to invest in marketing, while GPI will be involved in manufacturing and distribution. In fact, GPI has been bolstering its distribution strength in the southern and eastern states, areas considered weak for the company. Philip Morris is likely to keep its 100% India arm, set up to import and distribute Marlboro, as a shell company that will hold the brand rights, people familiar with the situation said. Philip Morris was interested in acquiring its partner's stake in GPI, but Mr Modi has steadfastly refused its overtures for years. Besides, the government's refusal to countenance any increase in foreign holding in the tobacco industry also meant share buyout was not a straight-forward affair. The Union health ministry’s curbs on cigarettes (it banned smoking in public places last year) and Philip Morris’ realisation that it can’t do much on its own could also have contributed to the climbdown by the foreign firm. Cigarette advertsing is banned in India and the government doesn’t allow companies to increase capacities for manufacturing cigarettes. Japan tobacco has been trying to increase its stake in its Indian JV, but the government has still not cleared it. “Keeping in mind the numerous restrictions, it is best to utilise the current JV to push its brand in India. Afterall it is distribution that can lead to increased sales,” one industry official said. In 2003, Philip Morris Services India bypassed GPI and entered into an agreement with Barakat Foods & Tobacco (BFT) for the distribution of Marlboro cigarettes in India. The company directly imported the product, which was then distributed by BFT under a non-exclusive agreement. Also, smuggled cigarettes, especially the Marlboro brand, have been selling very well in India. According to industry estimates, of the 250 million cigarettes that come to India every year, Marlboro alone accounts for 100 million. Philip Morris has an India office, which is the subsidiary of Switzerland-based tobacco company Philip Morris International. Its global brand portfolio includes L&M, Parliament, Chesterfield, Bond Street, Philip Morris, Lark, Virginia Slims and Marlboro, none of which are marketed by GPI in India. Philip Morris Inc joined hands with the KK Modi Group in 1979.

Source: Economic Times

BSNL partners Nokia for 3G services

BSNL, India's third largest mobile company in terms of subscribers, has tied up with Finnish cellphone major Nokia for bundling 3G handsets along with its services. A senior BSNL official told PTI that the PSU has tied up with Nokia to supply handsets for its 3G subscribers. Nokia India Head, Operator Channels, V Ramnath said "Nokia India has partnered BSNL in bringing to Indian consumers 3G services on a host of Nokia devices." Nokia 3120Classic, Nokia 5320, Nokia N79, Nokia N81, Nokia E71 and the Nokia 5800Xpress Music will be offering BSNL 3G services. Owners of these devices will be able to avail of talktime as well as data packages across various price plans, he said. "We are also in discussions with BSNL to offer its subscribers a combination of free as well as paid for applications in order to further enhance consumer experience, Ramnath said. Chalking out an aggressive strategy to garner more 3G mobile subscribers, BSNL has also tied up with consulting arm of Swedish telecom equipment vendor Ericsson as part of its 'Go To Market' strategy. It will perform network improvement and optimisation services for the core, radio and transmission networks installed by its parent Ericsson," a senior official of the PSU had told media. BSNL is not positioning 3G service for the mass market, he said. The official, who did not wish to be named, said the PSU has reported 8,000-10,000 subscribers since its launch few months ago. However, industry sources disputed this figure saying the company may have garnered not more than 2,000 customers over 24 cities. Private players are yet to start the 3G service as they would get the required spectrum through auction, which is yet to take place. Till they launch the service, BSNL is trying to leverage its first mover advantage. BSNL launched 3G mobile services in February. The 3G services enables video streaming applications such as Live TV, movie downloads, high speed data download on mobile phones. Callers can also see each other on their mobile phone screens.

Source: Economic Times

GE Hitachi in talks with L&T for nuke plans

GE Hitachi Nuclear Energy (GEH) is in talks with Larsen & Toubro (L&T) to engage the engineering and construction firm as a potential vendor for its nuclear power plants in India. GEH had, late last month, announced a tie-up with state-owned equipment manufacturer Bharat Heavy Electricals Ltd (BHEL) for reactor manufacture. “We are in talks with L&T as well. The idea is to develop a supplier base in India for projects based on GEH’s Advanced Boiling Water Reactors (ABWR),” the Chief Executive Officer for GE Energy India, Bangladesh and Sri Lanka, Mr Kishore Jayaraman, said. GEH had, on March 23, announced the signing of two agreements with the Nuclear Power Corporation of India (NPCIL) and Bharat Heavy Electricals Ltd (BHEL) as the companies prepare to collaborate on building multiple GEH-designed nuclear reactors. Under the preliminary agreements, GEH will begin planning with NPCIL and BHEL for the necessary resources in manufacturing and construction management for a potential multiple-unit Advanced Boiling Water Reactor (ABWR) nuclear power station. According to GEH, its 1,350-MW ABWR technology is “the world’s only commercially proven Generation III reactor design”, with the first two of four units entering service in 1996 and 1997 and four additional units under construction currently. In the nuclear space, L&T has taken a first mover advantage and aggressively tied-up with a bevy of partners for reactor manufacture in the last couple of months. L&T has in place a preliminary agreement with Russia’s ZAO Atomstroyexport for manufacturing the ‘VVER series’ reactors.

Source: Business Line

Universal Cables in JV with Furukawa Electric

Universal Cables Ltd (UCL), part of the M P Birla group, has entered into a joint venture agreement with Furukawa Electric Co, of Japan, for manufacturing and marketing optical fibre in India.
As per the agreement, UCL and associates would have a 55 per cent stake while the balance would be held by Furukawa and its affiliates. The chairman of the board of the joint venture would always be a nominee of UCL from amongst its nominee directors.
D R Bansal, chief mentor and CEO of UCL said, “By combining the pre-eminent position of the M P Birla group in optical fibre and cable business in India, with significant experience and technical expertise of Furukawa with the best in world-class technology and industry leadership position, we will bring our customers a strong product offering, greater breadth of service and increased local presence with value accretive for the customers exceeding expectations."
Bansal added that the partnership would enable the new joint venture to utilize the distribution channels of Furukawa in the international markets to reach new customers and compete effectively with lower cost.

UBS Ties Up With UK's Noble For Research On Mid-cap Companies

Noble, the UK based investment bank specialising in mid and small cap companies research, has formed a strategic alliance with UBS in India for providing research on Indian companies. Under the arrangement, Noble will provide research on Indian mid and small cap companies to UBS’ global institutional client base investing into India.
Noble forayed into the Indian equity business in September 2008 with the acquisition of Clear Capital, a Mumbai based research firm focused on the small and mid cap equity market. Noble currently has a team of 11 analysts and sales people focused on Indian equities, and covering five sectors – Technology, Consumer, Banks/Financial Services, Power and Infrastructure, with a focus on stocks with market cap less than $2.5 billion.
The partnership is aimed at UBS’s existing coverage of BSE 100 companies with Noble’s research in the mid market.
Nick Paulson-Ellis, Head of Equities at Noble, said: “We think that the combination of our research base with access to UBS’ institutional investors and execution capabilities will benefit both the mid-cap companies we cover and those investors wishing to gain exposure to this fast growing segment of the Indian market.”
Saurabh Mukherjea, Head of Indian Equities at Noble, said: “We believe the Indian market presents huge opportunities in the mid- and small cap space.”
Noble group has 120 employees in offices in London, Edinburgh, Mumbai and Houston. It has a financial backing from Arch Group, an asset manager with $2 billion under management. It raised £100m venture debt in April.

Natco, Lupin in alliance to market tablets for kidney ailments

Drug maker Natco Pharma on Thursday said it has entered into an agreement with domestic pharma company Lupin to jointly market a variety of tablets used in treating kidney problems.
“Natco Pharma has joined hands with Lupin to jointly commercialise generic equivalents of Lanthanum Carbonate tablets,” Natco said in a filing to the Bombay Stock Exchange.
Lanthanum Carbonate tablets, invented by Shrine Plc, are sold under the brand name of Fosrenol. Natco had filed an abbreviated new drug application (ANDA) before the US drug regulator (Food and Drug Administration) to market the generic versions of Fosrenol in three different strengths. In response to the application, Shrine had filed two law suits against Natco alleging patent infringement for the drug, which Natco is defending. As of December 2008, global sales of Fosrenol amounted to $108 million. The two Indian drug makers (Natco and Lupin) believe that they are among the first to file for this product, which may lead to 180 days’ exclusivity for its marketing in the US. “This alliance brings together a strong philosophy of working together to maximise opportunities in an increasingly competitive generic business,” Natco Pharma director and chief operating officer Rajeev Nannapaneni said. Natco closed at Rs59.35, up 14.80%, while Lupin settled the day at Rs646.75, down 1.03% on BSE.

BSE, United SE in talks for strategic alliance

More Indian bourses are talking to each other to survive a long, fierce battle for business that's beginning to unfold in the local financial markets. The country's oldest exchange, Bombay Stock Exchange, has had preliminary discussions with United Stock Exchange of India, the youngest of the bourse, for a strategic alliance. A possible deal, that may take some time to consummate, could include equity participation, product sharing, marketing and distribution tie-ups and a common clearing house. Senior officials of the two exchanges had first explored the idea a few months ago and had met more recently to discuss the possibility. But there's a string of tricky issues that have to be sorted out before the exchanges can move ahead with the deal. For instance, BSE, as a strategic player, would like to hold more than 5% in the new exchange. According to exchange officials, while United SE is now open to offering a higher stake to BSE, formal negotiations are yet to take place on the finer points. "No final decision has been taken on the proposal," Jagdish Capoor, chairman of BSE, told ET. United SE received SEBI approval to launch trading in rupee-dollar futures. A strategic alliance with BSE would help United SE market and distribute its products through BSE's existing member brokerages, while BSE's clearing house, set up with Bank of India, which is also a stakeholder in United SE, can be used to manage the margin requirements of currency derivatives brokers on a real-time basis. However, the two exchanges must arrive at a common risk management approach, technology platform and a management policy before a deal is signed.

Religare, Milestone In 50:50 JV To Manage Education, Healthcare Fund

Religare Enterprises Ltd said on Wednesday that one of its arms has formed a 50:50 joint venture with Milestone Capital to manage a Rs 600 crore healthcare and education fund. Religare along with its affiliates have committed to contribute Rs 60 crore to the fund which has an existing corpus of more than Rs 100 crore. The fund will be raised in India, the statement said, without specifying if it would be 100% domestic capital.
Religare Venture Capital Pvt Ltd, the wholly owned subsidiary of Religare Enterprises, and Milestone Capital will hold equal equity stakes in the JV, which will manage the fund.
The minimum investment amount will be Rs10 lacs; the life of the fund will be 5 years and 18 month will be the commitment period, it said.
Religare has also drawn on some senior medical professionals from its group, a statement said. This would help in healthcare investing, although not so much in education. Religare Enterprises is promoted by the Singhs, the former promoters of Ranbaxy Pharmaceuticals. They also own India's largest medical care chain Fortis Healthcare.
"Private equity has been an area of great interest to us given the mangement’s experience of managing and ramping up businesses at a fast pace. Healthcare and Education are two sectors which we believe are poised for balanced growth and we have the requisite domain expertise on healthcare which we intend to leverage for larger benefit of investors of the fund,” Sunil Godhwani, CEO &MD, Religare said.
Milestone is founded by Ved Prakash Arya, who was earlier with Pantaloon Group. Milestone's India Build Out Fund-I (IBF-I) was launched in August last year with a target of $150 million (Rs 600 crore). It also had said that it had a further green shoe option of $50 million. This was the intention at the boom time last year, while the context has changed right now. As of now, the fund has managed to raise only Rs 100 crore ($25 million).
The fund had said last year that it would invest in sectors such as education and media & entertainment. Now the focus has been expanded to healthcare too. Milestone had also hired Rajesh Singhal from Intel Capital to spearhead the fund.
Milestone seems to be following a partnership model for their funds. In an earlier instance, Milestone had partnered with IL&FS Investment Managers to manage a REIT like structure.
Religare also have a JV model. They formed a PE JV - Vistaar Religare Film Fund - for investing in films and production companies. This JV with Milestone will take Religare's PE activity to other areas as well.
Religare currently has joint ventures for the other financial services such as with Aegon for life insurance and with Macquarie for wealth management.

BHEL to invest Rs 1,200 cr in JV with foreign firm

As part of its expansion plan, state-run Bharat Heavy Electricals (BHEL) will invest nearly Rs 1,200 crore in setting up a joint venture with an international firm for manufacturing transmission equipment, by June this year. "We are in talks with a European and a Japanese firm for forming a transmission joint venture by June 2009. We would be investing close to Rs 1,200 crore in this project as a part of our inorganic growth," BHEL Chairman and Managing Dirtector K Ravi Kumar told reporters here. BHEL is in talks with French equipment maker Areva and Japan's Toshiba on the joint venture. The tie-ups being explored will focus on manufacturing 765 kilo volt (KV) and 1,200 KV transmission equipment. BHEL secured orders worth Rs 10,254 crore in 2008-09 in captive power, transportation, power transmission, oil & gas and other industrial segments. The company received bulk orders for 40 transformers from Coastal Gujarat Power, a Tata Power special purpose vehicle, for executing the 4,000 Mw ultra mega power project at Mundra. BHEL today recorded a 6 per cent jump in its net profit after tax at Rs 3,039 crore for the financial year ended March 31, 2009, from Rs 2859 crore in 2007-08.

Novavax, Cadila form JV for developing vaccines

based biotechnology firm Novavax has formed a joint venture with Cadila Pharmaceuticals for developing and commercialising virus-like particle-based (VLP-based) vaccines.
The joint venture will develop and commercialise Novavax's VLP-based vaccine and Cadila's therapeutic vaccine candidates against cancer as well as its adjuvants, biogeneric and biological diagnostic products for the Indian territory, Navavax said in filing to Security Exchange Commission (SEC). Novavax would provide the technology and Cadila would invest $8 million (Rs 40 crore) over three years to support the joint venture operations, it added.
In the proposed joint venture, Cadila would have 80 per cent stake while remaining 20 per cent will held by Novavax, company said. Novavax will also have the right to negotiate license arrangements of certain vaccines developed by the joint venture for commercialising it outside the India. As part of the agreement which both companies signed on March 31, 2009, a wholly-owned subsidiary of Cadila will purchase 12.5 million shares of Novavax's common stock at the market price of $0.88 per share, for an aggregate of $11 million (Rs 55 crore). Cadila Managing Director Rajiv Modi will join the Novavax Board of Directors immediately.