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The Mint Report for 23 February 2010

The Mint Report for 23 February 2010
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First Published: Wed, Feb 24 2010. 12 55 AM IST
Updated: Wed, Feb 24 2010. 12 55 AM IST
New Delhi: After Toyota and BMW, it is now recall time for Maruti Suzuki. India’s largest carmaker is recalling some 100,000 units of its A-Star model from European and Indian customers. The company says it is replacing a potentially faulty part in the fuel pumps to prevent possible fuel leakages. It has already replaced the part in about 50,000 vehicles. Maruti is only recalling A-Star models made before August of 2009. The A-Star is Maruti’s flagship export model and is also sold locally in India.
And news of the recall sent Maruti’s stock plummeting on Tuesday, closing 3.24% down at Rs1,336.85.
Also on the markets, the government remains unfazed after the poor response to its follow on public offer for Rural Electrification Corp. or REC. The finance ministry has indicated its plans to sell stake in other public sector companies remains on track. The more than $750 million REC share sale was barely subscribed on Monday, in a reaction similar to the poor response to NTPC’s recent stake sale.
NTPC has dropped its $1 billion plan to acquire a South African coal mining firm. It’s acquisition was put off because NTPC did not want to spend an additional $500 million to set up washeries that process the high sulphur coal from South Africa. NTPC has been hunting for coal supplies all over the world to feed its power plants, but has not succeeded so far. 80% of NTPC’s installed capacity runs on coal.
In aviation news, Kingfisher Airlines plans to join an alliance of international airlines by 2011. Joining the OneWorld Alliance of airlines will give Kingfisher a chance to enter important routes in Europe, the US and Asia. The civil aviation ministry has yet to approve Kingfisher’s proposal.
Financial service company Religare Enterprises says it will acquire an American investment company called Northgate Capital in a deal worth 200 million dollars. Religare plans to invest $1 billion in buying asset management companies around the world.
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First Published: Wed, Feb 24 2010. 12 55 AM IST