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A spate of acquisitions and a greenfield plant by Indian companies marked the beginning of the week.
Rain Commodities said it would buy a 100 per cent stake in Rutgers, a Belgium-based coal tar pitch manufacturer, for Rs 4,918 crore (Euro 702 million).
Dr Reddy’s Laboratories said it would pay Rs 193 crore (Euro 27.39 million) for a 100 per stake in OctoPlus N.V., a service based specialty pharmaceutical company, while L&T Finance Holdings said it was paying Rs 120 crore to acquire FamilyCredit Ltd, an established non-banking finance company with presence across two-wheeler and auto financing.
On the BSE at 1.40 p.m., Rain Commodities’ Rs 2 shares were trading 3.70 per cent down at Rs 41.60; L&T Finance Holdings’ Rs 10 shares were flat at Rs 54.05; and, Dr Reddy’s Laboratories Rs 5 shares were up 1.48 per cent at Rs 1,726.25.
According to a Rain Commodities announcement to the stock exchanges, its wholly owned step-down subsidiary Rain CII Carbon LLC had signed a share purchase agreement with Triton to buy Rutgers. The transaction was expected to close in the first quarter of 2013.
Triton is an investment firm dedicated to investing in medium-sized businesses in Germany, Switzerland, Austria and the four Nordic countries – Denmark, Finland, Norway and Sweden.
The announcement said Rain CII planned to fund the transaction through a mix of internal accruals and issue proceeds of Euro 533 million long-term bonds.
Information on the Internet shows coal tar pitch is used chiefly as road tar, in water proofing roofs and other structures, and to make electrodes. Rain Commodities and its subsidiaries are engaged in producing and selling calcined petroleum coke, cement, co-generation of electricity and trading fuel grade green petroleum coke. Calcined petroleum coke finds application in aluminium, steel and titanium dioxide industries.
Rutgers buy is seen as complementary to Rain’s calcined petroleum coke business. Expanding into tar distillation business constitutes both product and geographical diversification for the Rain group.
Dr Reddy's to buy OctoPlus
Dr Reddy’s Laboratories and its subsidiaries announced an intended public offer to buy the outstanding shares of OctoPlus at a price that represented a 30 per cent premium over the closing price of OctoPlus on October 19. Dr Reddy’s held an irrevocable commitment from shareholders representing over 50 per cent of OctoPlus’s issued and outstanding shares. The executive board and supervisory boards of OctoPlus had recommended the offer to the remaining shareholders, Dr Reddy’s announcement said.
L&T Finance Holdings to buy FamilyCredit
L&T Finance Holdings said it had signed an agreement with Societe Generale Consumer Finance to buy FamilyCredit Ltd. This acquisition would consolidate L&T Finance Holdings’ presence in the auto finance business in India.
An L&T Finance Holdings’ announcement to the stock exchanges said FamilyCredit had a loan book size of Rs 1,287 crore as of June 30, 2012, of which two-wheeler financing constituted 53 per cent and car financing 35 per cent.
Lumax Auto Technologies said it would invest Rs 80 crore to set up a plant in Bangalore to supply plastic moulded parts for various models to be made by Honda Motorcycle & Scooters India, at its third plant in Karnataka. Lumax would finance the new plant its mainly from own resources. The plant was likely to go on stream in the first quarter of 2013-14.
>ramakrishnan.n@thehindu.co.in
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