Govt approves 5 FDI proposals worth Rs6,050 crore

The government on Thursday approved five foreign direct investment proposals worth Rs6,050.10 crore, including  Cadila Healthcare Ltd's Rs5,000 crore fresh equity infusion under FDI route through qualified institutional placement.

The approvals have been granted on the basis of recommendations of the Foreign Investment Promotion Board (FIPB) at its meeting held on 21 December 2015.

The five FDI proposals approved on Thursday include Sai Life Sciences Ltd's proposal for transfer of shares held by Alpha TC Holdings Pte Ltd to its wholly owned subsidiary Alpha FDI Holdings Pte Ltd and deletion of condition of compounding by the Reserve Bank of India imposed in the approval letter dated 14 August 2015. The proposal involves no fresh foreign investment.

Approval has also been granted to pharmaceutical firm Recipharm Participation BV to incorporate a wholly-owned subsidiary in India to engage in the business of investing in other companies and for making downstream investment through the WoS in an existing pharmaceutical manufacturing company, Nitin Lifesciences Limited by buying out shares from the promoters thereby increasing foreign equity to 74%. The proposal involves foreign investment worth Rs1,050 crore.

Health Media Publishing Private Ltd has been granted approval for transfer of its 99.90 per cent shares currently held by NRI investor Ajit Patel to Wellness Technology and Media Private Ltd, UK. The proposal involves no fresh foreign investment.

Buimerc Core Investments Private Limited has been granted approval for transfer of 100 per cent equity shares of NRI investors and resident investors to Buimerc Corporation FZE, involving foreign investment of Rs10 lakh.

Decision on six FDI proposals have been deferred. These include:

• Mining firm Gulf Quarry General Trading FZC's proposal for investment in a new factory in Amritsar for crushing of gypsum rocks to make gypsum powder, manufacturing of gypsum board etc in an Indian company which is yet to be incorporated;
• Financial services firm International Asset Reconstruction Company Private Limited's proposal for purchase of its shares by KKR India Reconstruction Pte Ltd Singapore, thereby increasing the foreign equity from 58.75 per cent to 78.96 per cent;
• Raheja QBE General Insurance Company Limited's proposal for transfer of  23 per cent shares currently held by Prism Cement Limited to QBE Asia Pacific Holdings Limited, Hong Kong, thereby increasing the foreign shareholding in the company from 26 per cent to 49 per cent;
• Equitas Holdings Private Limited's proposal for undertaking an IPO in accordance with the provisions of the SEBI ICDR 2009. The issue comprises a fresh issue and an offer for sale of equity shares by certain existing shareholders to eligible non-resident investors, including FIIs/FPIs/NRIs;
• HSBC Securities and Capital Markets (India) Private Limited's amended proposal for merger of the FIPB approval letters for incorporating a wholly owned subsidiary, which will act as a trustee company to HSBC Mutual Fund and a proposal for HSBC InvestDirect Financial Services(India) Limited, (WoS of HSBC Invest Direct (India) Ltd) to engaged into additional activities (NBFC); and
• Holcim (India) Private Limited's proposal for sale of 24 per cent stake in Ambuja Cements Ltd held by its holding company, Holcim (India) Pvt Ltd by the latter's holding company Holderind Investments Ltd (NR) and subsequent reverse merger through a share swap.

The commerce ministry also partly approved proposals by MPC Rhine River Limited to sell and transfer its shareholding in AKME Rhine River Projects Private Limited to a third party buyer, whether resident or non- resident, whether directly or indirectly, and/or transfer the construction development project being undertaken by AKME Rhine River Projects Private Limited to a third party buyer, whether resident or non- resident without any further requirement of government approval upon identification of the third party buyer.

The ministry rejected the proposals by Mokeme Chiwetal Izuchukwu of Nigeria for setting up a Limited Liability Partnership (LLP) in India for cash and carry wholesale trading/wholesale trading (including sourcing from MSEs) and construction company Lanarth Developers Private Limited's proposal for extension of period of redemption for 10,80,000 (11.25 per cent) preference shares of Rs100 issued to its existing foreign shareholder Baniyas International Private Limited  maturing on 30 March 2015 by three years i.e. on and up to 30 March 2018.

The following proposals were not brought before the FIPB:

• Proposals by Elanco India Private Limited for further foreign investment of $5 million to $10 million over the next 2 to 3 years from its existing shareholders (via a rights issue), ie, Elanco Nederlands Holding BV and Lilly Nederlands Holding BV at regular intervals in tranches;
• Datamark Prodapt India BPO Private Limited's proposal for change into its designated partner who has acquired 0.02 per cent of shares of the company resulting in change in the shareholding pattern of the company; and
• Volvo Asset Finance lndia Pvt Ltd's proposal to offer operating lease to its customers, for which company has been advised to seek FIPB approval.