Groupe Bull plans exit from PSI Data
Mumbai: French IT major, Groupe Bull, is understood to be close to concluding a deal to exit from PSI Data Systems and has reportedly reached a deal to sell its 50 per cent stake in the company.

It is also understood that those in the running include Aditya Birla Group company Birla Technologies and Citigroup company I-flex Solutions. Lazard India, Groupe Bull’s merchant banker for the deal, is understood to be in negotiations with the interested parties.

Groupe Bull’s exit from PSI Data is part of its global strategy, which also saw it exiting from the global ATM business last year. While now exiting from computer hardware business, the group is said to be focussing on its software business.

The company provides software services for overseas and domestic clients in financial services and capital markets. Sources said AV Birla Group’s move was in line with its strategy of growing through acquisitions. Birla Technologies has also been expanding its software business through strategic alliances.
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Pentamedia hits road block again on Film Roman deal
Chennai: Despite blaring publicity on its recently concluded restructuring of the deal between Indian entertainment graphics company, Pentamedia, Graphics and the Hollywood-based production company, Film Roman, the deal has gone into a new roadblock.

It is understood that Film Roman has termination the deal alleging that the former had committed "a material breach of agreement". According to a Film Roman release Pentamedia was in material breach of the stock purchase agreement signed on January 1, last and also the memorandum of understanding between the two companies signed on April 24, last.

As per the original agreement, Pentamedia was to have acquired 60 per cent stake in "Film Roman" through the purchase of newly-issued common stock in the company at an estimated value of $15 million.

With Pentamedia being unable to make the necessary payments, the companies restructured the deal under which, Pentamedia was to pick up 49.9 per cent of Film Roman's common stock for an overall consideration of $10 million.

It is understood that Pentamedia recently announced its inability to adhere to a key component of this revised deal providing an acceptable guarantee of payment of the agreed upon purchase price.

Film Roman has now announced that it intends pursuing all possible legal remedies in this case.
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Government rejects McDonald’s bid to remit licence fees
New Delhi: The government of India has rejected the application made by global fast-food giant, McDonald’s, application for approval to remit license fees to its US parent. The government has stated that the chain needs to submit its expansion plans in the country before it can get any approval for such remittance.

According to the fresh plans submitted by the fast food chain, McDonald’s intends to open 80 restaurants in the country by 2003. Currently, there are 25 McDonald’s outlets across Delhi, Mumbai, Pune and Jaipur.

It is understood that the main objection of the FIPB was that the chain’s original application to the board did not include any provision for the payment of such fee. The board has forwarded the US giant’s plans and application to the food processing ministry for a re-examination in terms of existing guidelines.

McDonald’s had asked for the Foreign Investment Promotion Board for approval to allow McDonald’s India Development to pay a licence fee of $45,000 to the US parent for every McDonald’s restaurant in India.
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Two companies in the race for ICI India’s pharma division
Mumbai: US pharma multinational, Pharmacia and domestic pharma company, USV Limited, are said to the in the race for acquiring the pharmaceutical business of ICI India.

Earlier, ICI India was exploring the option of roping in a strategic partner for its pharma business, which will serve the best interests of its shareholders, employees and customers.

US-based Pharmacia has been making a concerted attempt to enter the Indian pharma scene recently. Not so long ago, it narrowly lost a bid to acquired the German stake in the pharma company, German Remedies.

USV, on the other hand, has been active on the mergers and acquisitions (M&A) front, with its acquisition in 1999 of the Angispan and Amlopine brands from Lyka Labs and the takeover of Mumbai-based Neo Pharma. The company has also acquired Glaxo brands Anovate and Deborin.

ICI’s pharma business is essentially in the cardiovascular, anaesthetics and antiseptics segment and most of the products are original ICI research products. The company’s key brands include Tenormin (atenolol) used in the treatment of high blood pressure, Tenoclor (atenolol plus chlorthalidene) a combination drug of Tenormin and a diuretic, Tetmosol (monosulfiram) for skin diseases, Nolvadex (tamoxifen) for breast cancer and Aerrane (isoflurine) launched under licence from Baxter Healthcare in the anaesthetic segment.

The company has a manufacturing facility at Ennore near Chennai, which is designed as per ICI Plc UK’s standards.
ICI India, which has been revamping its operations in the recent past, has already divested its explosive and polyurethane (PU) businesses and converted its motor and industrial paints division into a joint venture with Berger Paints.
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Indian Hotels and East India in race for Hotel Corporation
Mumbai: Leading the pack for the acquisition of the government’s stake in Hotel Corporation of India are Indian Hotels, which runs the Taj group of hotels and East India Hotels, which runs the Oberoi group of hotels.

Others who are reportedly in the fray are Kamat Hotels, besides a few foreign hotel chains like the French Accor group, Hilton and Raffles. The deal is currently in the due diligence stage and Jardine Fleming India Securities Ltd is the global advisor for HCI’s disinvestment.

According to informed sources, the deal was HCI divestment was heading towards the final stages of due-diligence and dates for receiving bids would be set shortly. HCI’s expression of interest had earlier evoked an excellent response with around 28 companies having shown interest in its five hotels and two flight kitchens.

The government’s recent announcement allowing 100 per cent foreign direct investment through the automatic route has also been a shot in the arm to the foreign hotel chains.

HCI, which is currently a subsidiary of Air India, will go a long way in improving the valuation of the airline and enabling it fetch a much better price.

The prime properties of HCI include the Centaur Hotels at Juhu and at Santa Cruz in Mumbai, Centaur Hotel in New Delhi, Centaur Lake View Hotel in Srinagar, J&K and Centaur Hokke Hotel at Rajgir in Bihar.
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Ashok Leyland plans roll out of luxury bus
New Delhi: Hinduja group flagship, Ashok Leyland, announced its plans to introduce a new super luxury bus in alliance with Chennai-based Sundaram Industries and Spain’s Irizar.

The company, which has also launched a modern city bus prototype, will soon provide prototypes to Delhi transport corporation (DTC) for trial runs. The buses, to be launched in October/November, are likely to be priced at Rs. 20 lakh.

The new luxury bus would have a ‘space-frame design’ and sport a modern suspension. It would also have two chassis - one on the front and the other on the back, which would provide luggage space beneath the bus.

The company hopes to sell about 500 buses at over Rs 20 crore, both in India and overseas markets in the the first year of operations. According to the company, there is a growing demand for such buses for long distance, tourist and airport travel.

Irizar is Europe’s second largest producer of bus bodies and builds bodies for Mercedes, Scania, Volvo and Iveco.
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RPG may offload stake in MusicWorld to FIs
Mumbai: The RPG group is understood to be in negotiations with financial institutions like ICICI, UTI and IL&FS for offloading 25 per cent stake in MusicWorld Entertainment. This move is expected to fetch an estimated Rs 30 crore for the group. The company is said to be considering this move to fund its next phase of expansion.

According to sources, JM Morgan Stanley has been appointed as merchant bankers for the deal. Senior group officials confirmed that there was, however, no similar plans to rope in investors for its other retail chains — FoodWorld and Health & Glow.

MusicWorld currently has 11 stores across Chennai, Kochi, Bangaloere, Hyderabad, Delhi, Chandigarh and Kolkata.
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Maruti Udyog plans entry into tertiary services
New Delhi: In keeping with global trends, Maruti Udyog is expected to enter into the new businesses of car insurance, auto finance, corporate lease and pre-owned cars by November this year.

The company is understood to have set up a senior management team to sign deals with insurance companies and finance companies for its proposed entry into new businesses. Maruti has decided to provide car insurance, auto finance, corporate lease and fleet management and pre-owned cars services in an integrated form.

Codenamed "Operation Vistaar", the company is understood to have already put in place business plans and is currently in the process of finalising its marketing and advertising strategy.
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Enron appoints consultants for business valuation
New Delhi: In what is clearly seen as a prelude to its exit from this country, US energy major, Enron, is understood to have appointed Arthur Andersen and Jones Lang La Salle to undertake a valuation exercise of all its business in the country, including the controversial Dabhol Power Company.

It is understood that Jones Lang La Salle will assess all the real estate investments of Enron in India and Arthur Andersen will value the business worth energy major’s Indian operations.

Sources say that Enron is likely to suffer a huge hit in its real estate investments which were made during the boom period of 1992-95. Real estate prices, thereafter, have reached much more realistic levels and are significantly lower than those paid for by Enron.

DPC had disregarded the contents of the Godbole Committee report when it issued a preliminary termination notice to MSEB on May 19. It is well known that the Dabhol Power Company has already issued a termination notice to the Maharashtra government, which would mean that all parties concerned now have six months to resolve the issue amicably. If the talks fail, DPC would issue the final termination notice.
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RPG group introduces massive VRS
Mumbai: In what would be the biggest downsizing in the group, the RP Goenka group is planning to introduce its largest ever voluntary retirement scheme that would bring down its headcount by 6,000. This, it is understood, is being done to tackle the current economic slowdown. The group’s current strength is 63,000.

The group companies across which such reduction is likely to happen are, CESC, Noida Power Company, Ceat Ltd, RPG Life Sciences, Harrisons Malayalam, the Spencer brand—FoodWorld, Health & Glow, MusicWorld, Cash & Carry and Saregama India, Ceat Financial Services and RPG Itochu.
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Reliance Industries chalks out ambitious R&D strategy
Mumbai: With an aim to capture the entire value chain through knowledge intensity, Reliance Industries has chalked out a massive six-pronged research and development (R&D) strategy.

The action looks at improving asset productivity, building a strong intellectual property rights regime, increasing pace of new product introductions, building new product platforms, growing the domestic market for all products, and develop future opportunities through discovery research.

Besides investing in the department of scientific and industrial research (DSIR), an accredited R&D centre, which covers covers instrumentation, characterisation and wet lab polymerisation, and pilot plant activities at Hazira in Gujarat, the company is also going in for a large number of research alliances. These include alliances with the National Chemical Laboratories in Pune. .

Reliance Industries also has initiated various basic research programmes in the polymers and fine chemical fields. The company filed one patent, three research publications and 12 technical reports this year, it said in its annual report for 2000-01.
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Hoechst likely to exit TB market in country
Mumbai: Franco-German multinational, Hoechest Marion Roussel is likely to exit the anti-tuberculosis drugs market in the country. It is understood that the company is planning to phase-out its brand Hostacycline if it continues to be under price control in the New Drug Policy. The anti-biotic Rulide is also expected to be phased out gradually.

According to company sources, with these drug being under control, even if the top line reduces with these products being axed, the bottom line is likely to perk up substantially. Later this year, the company plans to introduce a new product for rheumatoid arthritis called Arava.

The company has also commenced marketing five brands in areas like cancer and cardiovascular from sister firm Rhone-Poulenc Rorer whose marketing team has been integrated with that of HMR.

The decision to exit the anti-TB business has been primarily prompted by Aventis Pharma's change of focus away from the TB business in the world market.

HMR has been implementing a product portfolio revamp for four years and has exited old, unprofitable brands in categories like anti-biotics and nutritionals while at the same time launching new generation products from Aventis Pharma's stable in segments like anti-diabetes and anti-allergy.
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IBM makes blockbuster breakthrough in storage technology
New York: US-based IT giant, IBM, announced that it has made a massive breakthrough in disk storage technology which uses a new type of magnetic coating called, pixie dust, which allows even the smallest computer to store large amounts of data, audio and video.

IBM said that the new coating could quadruple the data density of hard disk drive products. This is made possible with a three-atom-thick layer of the element ruthenium, a precious metal similar to platinum, sandwiched between two magnetic layers.

The new multilayer coating is expected to allow hard-disk drives to store 100 billion bits, or 100 gigabits, of data per square inch of disk area by 2003, as against the current density of hard disks in the range of 25 gigabits.

Within two years, IBM expects that the technology would allow for desktop computer hard drives with the ability to store 400 gigabytes, or the information in 400,000 books.
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