Samsonite to launch premium line for global market
Pune: Samsonite India is launching a new line of products for international market in the premium segment in the first quarter of 2001. The product is to be simultaneously launched in Japan, Germany and the US. This is for the first time an Indian team is involved in the development of a product for the global major.

The new line will be manufactured at Samsonite's Nashik plant and then exported to major global markets. The company has invested over Rs 14 crore to put up a new production facility, which would be launched in eight models there. The company is however, undecided on launching its new global premium range in the Indian market, because of the high price tag.

The Rs 70-crore Nashik plant is becoming a major global supplier for the luggage manufacturer's operations, with four of its lines, including the largest selling premium brand, Oyster, being manufactured. Samsonite India has recorded revenues of Rs 65 crore from its domestic operations for the year ended December 2000.
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Telco to relaunch modified 697 engines for MCVs
Mumbai: Tata Engineering & Locomotives Ltd. (TELCO) reportedly is considering relaunching the 697 range of engines in its medium commercial vehicles, after making certain key modifications. The 697 range of engines, which would be turbo charged and made Euro compliant, will be initially used only in the medium commercial vehicles (MCVs).

Lowering the price of MCVs is believed to be one of the main reasons for bringing back the old engine. The company had suspended production of the 697 range, as it was not conforming to the new emission norms and had switched to Cummins engine. A Cummins engine-driven truck is however priced approximately Rs 85,000 more than the 697 engine.

The commercial vehicles fitted with the 697 range of engines will be now cheaper by around Rs 35-40,000, than the Cummins-powered vehicles. The 697 range is expected to make a difference to the poor sales of MCVs, which recorded a fall of 40 per cent during the past one year.
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Exide to set up a JV in Bangladesh
Kolkata: Exide Industries, makers of Eveready batteries, is planning to set up a joint venture in Bangladesh to offset anomalous duty structure in the country. The proposed 60:40 joint venture, the first such offshore manufacturing facility to be set up by Exide will have an initial paid-up capital Rs 6 crore.

With the rising cost of production within India, storage battery companies have been increasingly finding the prospects of setting up offshore manufacturing bases more viable option. Besides, there are definite cost advantages in manufacturing batteries in Bangladesh, where the duties on lead, a key raw material, are lower at 5 per cent compared to a high of 38.5 per cent in India. It is, thus, more advantageous to produce batteries in Bangladesh and export it back into India.

Lead a major raw material in the manufacture of batteries constitutes the largest chunk of raw material imports. The lopsided tax structure between the cost of the raw material and finished product has made manufacturing uneconomic in India.
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Alcoa and Hindalco to jointly bid for Balco
New Delhi: Hindustan Aluminium Company (Hindalco), an AV Birla group company and the US-based Alcoa, have joined together in the bid for acquiring the 51 per cent government stake in Bharat Aluminium Company (Balco). With Alcoa joining hands with Hindalco, after initially bidding separately, there are now only two bidders in the race, the other being Sterlite.

Both the bidders have submitted their comments on the initial draft of the shareholders’ agreement (SHA) and share purchase agreement (SPA). The department of disinvestment is expected to call for financial bids from the two bidders in the first week of February and the disinvestment process is to be completed in next two months.

The government currently holds 100 per cent stake in the company and proposes to divest 51 per cent to a long-term strategic partner. The Disinvestment Commission, in its second report, had recommended sale of 40 per cent equity in Balco in the first stage. Mr. G. V. Ramakrishna, chairman of the commission had subsequently, suggested the sale of 51 per cent equity to a long-term strategic partner.
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Borregaard keen to acquire stake in Suven Pharma
Hyderabad: Borregaard Industries Ltd., part of the Norway-based $4-billion Orkla group, is planning to acquire a sizable equity holding in the Hyderabad-based Suven Pharmaceuticals Ltd. (SPL), involved in development and supply of intermediates and contract research and custom manufacturing services.

According to Mr. Venkat Jasti, managing director of SPL, the company board has approved a proposal to offer four lakh equity shares of Rs 10 each to Borregaard at a price of Rs 250 per share on a preferential allotment basis. This will enable Borregaard to acquire nine per cent equity holding in the company's expanded equity of Rs 4.4 crore. The fresh funds flow is expected to help in expediting the implementation of Rs 40-crore plans towards upgrading R&D, pilot plant and manufacturing facilities.'

SPL has been over the past hew years making substantial exports to Borregaard and working through Norwegian firm’s technical co-operation for developing intermediates for few global life science companies. Some of these products are already at an advanced stage of commercialisation.
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NTPC drops LNG power project in Mangalore
Bangalore: National Thermal Power Corporation Ltd. (NTPC) has reportedly dropped the proposal for setting up a 2000-MW liquefied natural gas (LNG) power station in Mangalore. In a letter to this effect, Mr. Suresh Prabhu, union power minister has told the Karnataka state government that the project, which entails a tariff upwards of Rs 4 per unit, would be unaffordable.

The gas link was to have been tied up through Petronet LNG, with a pipeline from Cochin to Mangalore. However, when the project was proposed, international oil prices were ruling below $20 per barrel. Oil prices, have subsequently, shot up by $32 per barrel or $240 per tonne and with gas prices benchmarked to oil prices, the effect on the tariff would make it an unviable source for base load requirements.
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IFC to pick up 7% stake in Indian Seamless Metal
New Delhi: International Finance Corporation (IFC) is acquiring about 7 per cent equity stake at a cost of Rs 20 a share in Indian Seamless Metal Tubes (ISMT), the flagship company of the Pune-based Indian Seamless group. This is the first such acquisition of stake by a multilateral institution in India, after the government has allowed multilateral institutions to invest in equity of domestic companies, through the automatic route.

The IFC will be acquiring 15 lakh shares of ISMT, which is one among the eight largest seamless tube manufacturing company in the world. ISMT has a total paid up equity capital of Rs 23.53 crore. IFC’s acquisition of stake is also the first such private placement being done by Indian Seamless Metal Tubes, after it merged Kalyani Seamless Tubes Ltd.

The equity infusion by IFC is to be deployed in company’s proposed expansion plans. Besides, with IFC as its financial partner, the company could leverage its efforts in raising additional resources in future. After the merger, the Rs 450 crore ISMT is expected to make a turnaround this year with a profit of Rs 9 crore.
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