Mumbai: Mint brings you your dose of the top deals news, reported from newsrooms across the country
TPG Capital, Advent International likely to infuse funds in Yes Bank
TPG Capital’s Indian private equity arm and buyout firm Advent International Corp. are among the institutional investors that may infuse fresh capital into Yes Bank Ltd, Mint reported citing two people directly aware of the ongoing discussions. While the amounts to be invested are currently being negotiated, the front runners TPG and Advent International are most likely invest around $350 million each. Yes Bank has met at least 76 firms, including PE funds, high net-worth individuals and investment managers over the past two months to seek more funds. The bank plans to issue new shares through the preferential allotment route to TPG and Advent International. Its chief executive Ravneet Gill had announced on 17 July that the bank would raise $1.2 billion and is in discussions with several private equity players. A capital infusion has become indispensable for Yes Bank to stay afloat. “The bank’s weak performance in fiscal 2019 led to its capital, as measured by the common equity tier 1 ratio, falling to 8.4% from 9.7% in fiscal 2018," said US-based rating agency Moody’s Investors Service.
CDPQ pulls out of road deal with Essel
Canada’s Caisse de dépôt et placement du Québec (CDPQ) has dropped its plan to buy three road projects from cash-strapped Essel Infraprojects Ltd, Mint reported citing three people aware of the development. While there is no clarity on why CDPQ has decided to back out of the deal, Essel is now trying to sell these assets to a joint venture platform between India’s National Investment and Infrastructure Fund (NIIF) and Roadis— the infrastructure investor owned by PSP Investments, another Canadian pension fund manager. If the talks with NIIF succeed, it will be the maiden investment for the new platform that NIIF has set up with Roadis. At the time when Essel agreed to sell its three road projects to CDPQ, they were expected to fetch an enterprise value of ₹3,300-3,500 crore originally. The assets on the block are toll roads in Madhya Pradesh (the Lebad-Jaora state highway), Karnataka (the Navayuga Devanahalli Tollway near Bengaluru airport, a national highway) and Telangana (Essel Dichpally Tollway, a state highway). The proceeds of the sale were to be used to pay down the firm’s debt, which stood at ₹11,466 crore as of December 2018. The deal was also supposed to offer a foot in the door for CDPQ in India’s highways business, which has attracted considerable foreign investment over the past two years.
Shriram Transport looks to raise $200 million
Shriram Transport Finance Co. Ltd looks to raise $200 million from International Finance Corp. (IFC) to fund the purchase of commercial vehicles and lending to micro small and medium enterprises (MSMEs), Mint reported. Around $100 million will be invested from IFC’s own account, while the rest would come from like-minded partners, the company said in a statement. The first tranche of $82 million has already been disbursed, of which half was from the World Bank’s investment arm. The proceeds will be used for lending to small road transport operators and MSMEs in rural and semi-urban areas in low-income states. In 2016, IFC had invested in Shriram Transport to help expand its MSME loan portfolio for low-income states. In 2017, IFC invested in the company’s first offshore, rupee-denominated masala bonds, to further diversification of its funding sources.
NCLT approves Patanjali's ₹4,350-crore revised bid for Ruchi Soya
The National Company Law Tribunal (NCLT) approved yoga-exponent-Ramdev-run Patanjali's revised ₹4,350-crore bid to take over the edible oil maker Ruchi Soya, which owed banks over ₹9,345 crore, Mint reported from a wire agency feed. However, the tribunal said the approval is subject to the tribunal resolution professional bridging the information gap regarding the exact source of funds worth ₹600 crore (which is part of the bid amount) before the next date of hearing on August 1. The tribunal also asked the resolution professional to furnish the actual cost of the entire resolution process before the next hearing.
Future Fashions $250 million deal with Blackstone
Private equity firm Blackstone has stitched up a $250 million investment in Kishore Biyani’s Future Lifestyle Fashions Ltd (FLFL), owner of retail chains Central and Brand Factory as well as several clothing brands, The Economic Times reported citing people aware of the transaction. The primary infusion of capital will be through a combination of equity and structured debt that will fund the capital expansion of Biyani’s deep-discount retail format Brand Factory, which is modelled on US retailer TJ Maxx, besides improving his promoter-level leverage. The company’s board is meeting today to finalise terms, following which an announcement is expected. The structured credit line will be for five years with a fixed coupon while the equity upside is expected to accrue through Blackstone’s stake in FLFL’s operating company. Blackstone will pick up a 6-7% holding, joining investors such as L Catterton and PremjiInvest, which together own around 17%. Other key equity investors include L&T Mutual Fund (4%) and LIC (6.5%). Biyani and family own 53.43% of the listed FLFL through entities such as Ryka Commercial Ventures, Central Departmental Stores and Future Enterprises among others.
AION all set to buy majority stake in Adlabs
AION Capital is close to acquiring a controlling stake in Manmohan Shetty-led Adlabs Entertainment Ltd, The Economic Times reported citing two people with direct knowledge of the development. They said that the private equity firm is in talks with the Union Bank-led consortium of 13 lenders, who have a combined exposure of around ₹1,100 crore to the cash-strapped Adlabs Entertainment The joint venture firm between US-headquartered global private equity fund Apollo Global and domestic alternative assets manager ICICI Venture Funds Management Company, AION is negotiating with bankers to restructure debt of Adlabs Entertainment, after which it could end up with a 75% stake in the firm. Bankers will have to take a haircut, but it is better than having to take the company to NCLT (National Company Law Tribunal), one of the persons told ET. Adlabs Entertainment, which had raised ₹144 crore from ICICI Venture Funds Management Company in 2013 for its flagship project Adlabs Imagica, went public in 2014. The company currently owns a water park, an all-weather theme park and a snow park at Khopoli on Mumbai-Pune highway.
General Atlantic in talks to hike stake in PNB Housing Finance
Private equity investor General Atlantic is in talks to raise its stake in PNB Housing Finance, the country’s fifth largest home finance company, by pumping in close to ₹ 1,200 crore through a planned preferential allotment of shares, The Economic Times reported citing people briefed on the matter. This is the US-based fund’s second attempt to increase its stake in the company in which it had acquired a 9% holding during the time of its initial public offering three years ago. The fund had reached an agreement to acquire a part of Punjab National Bank’s (PNB) holding in the company in March, but the deal fell through the cracks as it didn’t get a requisite regulatory nod. The PE investor has been working on an alternative plan to invest further in the company ever since, though it could face opposition from promoter PNB, which is not keen on diluting its stake at current market prices. PNB owns around 32 per cent stake in the company and an investment by the fund could lead to a dilution of its stake by 2-3 per cent, according to ET’s estimates.
LEAP raises funds in round led by TVS Capital Funds
Mumbai-based supply chain solutions provider LEAP India has raised ₹216 crore in a Series C round led by private equity firm TVS Capital Funds, Mint reported citing senior executives. TVS Capital has infused ₹100 crore into the venture, while existing investors Sixth Sense Venture Fund invested ₹32 crore, and Samena Capital pumped in ₹40 crore. Mayfield and IndiaNivesh Fund, among others, also participated in the round. LEAP India has so far raised $97 million, including equity and debt financing. Its early investors include TCI Ventures, SSG Capital Management Group, and Marico founder Harsh Mariwala’s son, Rishabh Mariwala. The new funding will help strengthen the logistics firm’s capabilities by investing in track and trace technologies, enhancing our information platforms and modernising the operational infrastructure to provide a best-in-class customer experience.