IFCI-IDBI merger on the cards
New Delhi: The finance ministry is contemplating the merger of the two giant financial institutions, IDBI and IFCI.

The merger would be a coming together of synergies, to create a colossus. IDBI, which already holds a 31.7 per cent stake in IFCI, with representation on the board of IFCI, is strong in the west and south India, while IFCI's strength is in the north. The merging of the two would see a giant institution with an equity base of Rs 1,299.05 crores, a combined investment base of Rs 13,090 crores, combined advances of Rs 67,927.29 crores, while the interest earnings would be in the region of Rs 8,637.43 crores, and the dividend income would be 847.62 crores. Only the aggregate profits would be lower at Rs 755.21 crores, with IFCI's recent losses eroding IDBI's profitability.

IFCI is the oldest financial institution in the country, but in terms of growth, IDBI has grown faster and has left IFCI far behind.
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Reliance to enter call centre business
Mumbai: Petrochemical giant Reliance plans to enter the call centre business in a big way.

Operating under the Reliance Infocom banner, these would function in vertical segments like oil and gas, telecommunications and the financial sectors, covering a range of tasks such as responding to telephone calls, to outsourcing of back-office work such as processing of insurance and credit card claims.

It has drawn up plans to employ 100,000 agents within the next three years, setting up shop in ten cities of the country, including the metros, Bangalore, Hyderabad, Ahmedabad, Vadodara, Pune and Rajkot, covering a total space of one million square feet. The Mumbai call centre will be located in Thane district. The services will become operational next year.

Reliance will offer outsourcing services of all kinds, ranging from simple tasks such as answering e-mails to complex tasks such as helping consumers install digital subscriber lines.

In the oil and gas segment, Reliance Infocom will offer to carry out the back end work associated with oil and gas trading and building of refineries.
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Bharti to go for private placement
New Delhi: The Bharti group is planning to raise 200 million dollars through private placement in order to fund its telecom projects.

Earlier, the group was planning an IPO, which it has postponed for the moment due to unfavourable market conditions. The private placement of equity will serve as bridge finance until conditions are better.

These will go to fund its ventures in Bharti Televentures, for national long distance telephony, and basic and cellular services.

It is also likely to give a one per cent stake in Bharti Televentures to International Finance Corporation for a 20 million dollar investment, besides a loan of about $50 million.

Bharti, in the meanwhile, is focussing effort to consolidate the mobility business and commence operations, and on building broadband and long distance network, including completion of the Singapore-Chennai undersea cable by the end of this year.
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Ericsson sets up crisis crew
New York: The board of Ericsson has formed a three-person committee to monitor the restructuring work of the management, in the wake of losses in the first quarter of the current year. The Board has even threatened to make management changes if the situation does not improve.

The Ericsson board is also contemplating a joint venture between part of its consumer products division and the handset division of Sony Corporation. The joint venture, to be based in London, is likely to be called Sony Ericsson. with Sony. Other restructuring measures to stop losses at Ericsson's handset division are also on the cards.
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DRL to reorganise Russian operations
Hyderabad: Dr. Reddy's Laboratories is reorganising its operations in Russia.

This is being done in order to achieve better control, and overcome uncertainties in the Russian regulatory framework. It is also scouting for legal and accounting expertise so as to leverage fully, the tax and other benefits of a Russian operation. DRL has a joint venture, Reddy Biomed, operating in Russia.
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Cadila launches neuro-drug
Ahmedabad: Cadila Healthcare has launched Xet, which will combat anxiety and depression.

The new drug will address the 'neuro-psychiatry' market in India, which is estimated to be of the order of Rs 600 crores.

The drug was launched by the Cadila Neuroscience unit.
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Wockhardt launches 'epox'
Mumbai: Wockhardt has launched 'epox', a recombinant human erythroprotein drug to treat cancer and renal failure.

The new drug, based on biotechnology --on mammalian cell culture -- will be sold in the Indian market at 30 per cent less cost than the imported products, to make it more affordable, and yet achieve a sales of Rs 10 crores within two years of the launch.

Wockhardt is looking to launch this drug globally, as a biotech super generic, for which appropriate applications are being made, with regard to meeting the required standards, clinical studies and patent requirements.
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LIC’s Nepal joint venture on the anvil
Mumbai: The Life Insurance Corporation is to start its Nepal operations within the next two months.

The joint venture with the Vishal group of Nepal will have a paid up capital base of Nepalese Rs 20 crores, of which LIC will hold 55 per cent share.

LIC is also restructuring its London operations for which it is looking for a partner to help further expansion.

LIC also has a 100 per cent subsidiary in Mauritius, which would shortly begin selling its policies.
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Videocon Petro to invest Rs 1000 cr in Kakinada
Mumbai: In the wake of its success in the Ravva joint venture, the Videocon group has been enthused to invest further in oil and gas exploration. Its 49 per cent subsidiary, Videocon Petroleum, is to invest Rs 1000 crores in the Krishna-Godavari Offshore 6 (KGOS6) project at Kakinada near Vishakapatnam. The work is mainly drilling and exploratory.

Drilling has commenced since December 2000, and preliminary surveys have indicated the presence of oil. The company expects to strike oil within a month.

Videocon is enthused by its experience in the Ravva joint venture, where it holds a 25 per cent stake. The Ravva venture is yielding 50,000 barrels of oil per day, which accounts for 8 per cent of the country's oil production, and is bringing in profits to the tune of I million dollars per day. Videocon believes that the Kakinada project will yield five times the output of the Ravva project.

Videocon has also been awarded a production contract in a joint venture with Command Petroleum of Australia, Marubeni Corporation of Japan and Oil & Natural Gas to develop and further explore oil and gas in the Bay of Bengal.
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Tata AutoComp-Yutaka Giken in JV
Mumbai: Tata AutoComp Systems and Yutaka Giken have set up a joint venture, Tata Yutaka AutoComp Ltd., to make exhaust systems, including fabricated manifolds and catalytic converters for cars, two wheelers, MUVs and commercial vehicles.

The 50:50 joint venture with an equity of Rs 5.2 crores each will also look to introduce the entire range of Yutaka Giken products, including brake disc for two wheelers.

Tata AutoComp is in automotive parts, while Yutaka Giken is a major Japanese player in automotive exhaust systems.
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M&M to launch two new models
Mumbai: Mahindra & Mahindra is seeking to regain its lost leadership in the utility vehicles sector by launching two new models on the Scorpio platform.

The models will be available in both petrol and diesel versions, and in top and mid-end ranges. The company will launch the top end vehicles first, a sports utility vehicle that will compete in the same segment at the Tata Safari, in the third quarter of this fiscal.

The top end petrol version will be fitted with Renault 2.8 litre engines, while the diesel version is likely to have a turbo-charged engine modified by AVL. The low-end model, designed for the rural markets, may only come in the diesel version.

The company will be sourcing parts and technology globally, such as engine technology and design from Austrian company AVL, axles from Dana, seats from Lear, and heating, ventilating and air-conditioning systems from Behr.

The company has so far invested Rs 500 crore in the project, working on it for over two years.
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Reliance puts up EPC firm
Mumbai: The Reliance group has floated an engineering, procurement and construction (EPC) firm, Reliance Engineering Associates. The new company will undertake projects for both the Reliance group as well as outside parties.

This new EPC will compete with the likes of L&T and Bhel, and will have four profit centres -- the EPC project division, manufacturing plant services division, fabrication division and construction, and the plant and machinery division.

Reliance, of late, has been making its presence felt in the infrastructure sector, especially in telecom infrastructure, with a planned investment in the region of Rs 15,000 crores. It also plans to enter into the construction of ports, highways, housing complexes, water supply systems and IT networks Over the past few years it has implemented projects worth 10 billion dollars. This includes a fibre optic network backbone across the country through its Infocom project, which it is implementing, which will offer virtual private network, data centres and bandwidth leasing. It is also entering long distance telephony in a big way.
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Dr Reddy's to push generic in US
Mumbai: Dr Reddy's Laboratories is planning a US base, which help it sell generic products.

A number of drugs will go off patent in the next five years, and will become open for manufacture, which Dr Reddy wants to exploit. Besides, Cheminor Drugs, which DRL acquired, had filed a number of abbreviated new drug applications (ANDA) to market formulations in the US.

The company also plans to go in for acquisitions, both in the US, and locally, for which it has earmarked 90 million dollars.

Additionally, it has earmarked 30 million dollars for drug discovery and development studies.

Both these are funded from the proceeds of the 115 million dollar ADS made by DRL. The US market has an 18 billion-dollar generic products market, which has 60 per cent imports from countries like Italy, Spain and Israel.

DRL has entered into strategic alliances with US based Par Pharmaceuticals, Warwick Pharmaceuticals and Leiner Health Products. It has also set up a US subsidiary for R&D, Reddy US Therapeutics Inc., to explore new molecular targets and design screening mechanisms for new drugs.
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