The Mint report

The Mint report

New Delhi: Merger talks between Bhart Airtel and MTN have got a new lease of life. The two companies have agreed to extend their period for exclusive merger talks till the end of August. Also, Bharti has hinted it could sweeten its offer to get MTN shareholders to support the deal. At least 75% of MTN shareholders need to back the deal for it to go through. Analysts say Bharti could sweeten the deal by having one of its major shareholders, Singtel buy GDRs at a premium from MTN shareholders.

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Many companies are now bargaining for cheap money. They’re taking advantage of extra liquidity in the system to negotiate for cheap, short-term loans from banks. Firms with good credit ratings can get a three-month loan for as little as 4.5%. A normal one-year loan on the other hand would have an interest rate of about 8 to 12%. Public sector oil companies are leading this trend and bankers say they’re comfortable lending to oil companies because they have smooth cash flows.

The government introduced the Companies Bill 2009 in Parliament on Monday. The bill proposes major changes to the businesses are set up and run. The bill allows one-person firms to be set up. It also bans insider trading, which is now only prohibited by Sebi, the stock market regulator. The bill also stops promoters from raising money from the public without getting approvals.

Also in Parliament, petroleum minister Murli Deora laid out the government’s stance in the gas dispute between the Ambani brothers. He said the government had no interest in interfering in the dispute and was not discriminating against anyone. Last week Anil Ambani had accused Deora of favouring his estranged brother Mukesh in the gas dispute.

Markets continued to soar on Monday. After hitting a one-year high on Friday, the Sensex jumped again, this time by 254 points to close at 15,924. And it was the Nifty’s turrn to register a year long high on Monday, rising 75 points to end trade at 4,711.

There was some good news for the auto industry. Analysts say auto sales numbers for July indicate a recovery in the auto industry. While car and two-wheeler makers started recovering in the beginning of the year, even heavy vehicle companies that have been hit worst by the recession are showing signs of picking up. To find out if this trend is sustainable, we go over to our correspondent Samar Srivastava.

High real estate costs often eat into the margins of car dealers, and some are even forced to shut down. But Skoda in India is trying to deal with the problem. It is setting up small boutique showrooms that display just one or two cars and focus on advertising the brand. There are even model cars and other merchandise you can buy. Skoda says it plans to open five such stores in big cities by the end of next year.