R-ADAG To Buy 51% In UK Currency Company For $20M

Reliance Capital is buying majority stake in UK-based exchange and money transfer firm No 1 Currency. Reliance Money Express, a subsidiary of Reliance Capital is picking 51% in Edinburgh-based No1 Currency for an estimated Rs 100 crore($20 million).

The deal will extend the scope of R-ADAG’s existing money transfer and currency exchange business. Reliance Capital, the group’s finance arm had in November 2006 acquired TravelMate from Swiss travel and tour firm Kuoni to enter the currency exchange business. This business was renamed as Reliance Money Express.

Last year Reliance Money Express had picked a strategic stake in public listed Wall Street Finance, which is engaged in money transfer business. Wall Street is also looking to get into domestic money transfer business which could peg it in competition with the likes of postal department’s money order business.

The UK deal will allow it to foray into the international forex business and to capitalise on the 1.6 million NRI population in the UK for money remittance business. This also mark the first overseas acquisition of a foreign exchange company by an Indian firm.
Edinburgh-based No 1 Currency operates close to 300 currency exchange outlets in the UK and is one of the fastest growing independent foreign currency specialists in the country. Formed in 1996, the privately-held firm is owned by its two founding partners David Hale and Mark McElney. The two partners will sell their shares partly to Reliance Money Express.
The current management of No1 Currency will continue to lead the firm and R-ADAG will get representation in the board of the firm.

What is interesting is that R-ADAG had been active in striking small and mid sized deals in the financial services sector even when the sector is hit the hardest due to global credit crisis. It had picked a stake in an upcoming commodity bourse in Hong Kong and is also looking to kick-start a commodity cum stock exchange in Nigeria. It already has a broking venture in Saudi Arabia

Reliance Life Sciences looking out for acquisitions

Reliance Life Sciences (RLS) and its fledgling subsidiary Reliance Pharmaceuticals Ltd (RPL) are looking at options, including roping in a strategic partner or an outright acquisition. The company is reported to be scouting for a potential acquisition in the US, an industry source told Business Line.

RLS had picked up 74 per cent equity in the UK-based biotech firm GeneMedix earlier this year. And this was followed up with RLS partnering with the US-based global investment management firm MPM Capital LP. The partnership envisaged RLS becoming a strategic partner in MPM Capital's newest fund, MPM BioVentures IV, with a corpus of $650 million.

(Source: Business Line)

Reliance Capital may sell minority stake

Anil Ambani has been on a buying spree all these months picking up stakes in diverse companies through his financial services arm Reliance Capital.But now it seems he is looking for a buyer who will acquire minority stake in his insurance ventures. And foreign players waiting for a foothold in India are queuing up for a piece of the action.

NDTV has learned that ADAG group company Reliance Capital is planning to rope in a partner for the insurance business. The group is likely to sell 26 per cent each in its life and non-life insurance businesses.

Reliance's insurance businesses are valued at around $1.2-1.75 billion and contribute about 25-30 per cent of the price of the Reliance Capital share. Reliance ranks second in general insurance and fifth in life insurance among the private players.For private insurance players like Reliance it is now the investment stage where they have to pump in money to build their distribution network and also meet regulatory requirements.It will take a while for many of them to break even in the life insurance segment though ADAG group is not short of cash it may want to realise value when the going is good and when other players like ICICI Prudential and SBI Life are also looking at diluting the group holdings.

(Source: NDTV profit)