The more the merrier that’s the SpiceJet story as the race for this low cost airline hots up.

So besides the king of good and bad times Vijay Mallya and Wilbur Ross, SpiceJet’s bankers Rothschild have shortlisted two more bidders till now.

This takes the suitor tally to four, out of which three are just investors while the fourth Vijay Mallya is looking a big bang merger with SpiceJet.

Mallya’s offer involves a share swap, which could be either 1:3 or higher along with a cash advance of about Rs 200 crore. Under this offer once the share swap is done both the airlines will merge.
The present promoter will get Kingfisher Airline shares with a lock in period after which the promoters can exit.

The other simpler option for SpiceJet management is to bring in investors like Wibur Ross or other PE funds that specialise in stressed sales.

SpiceJet will issue fresh equity to these investors giving them about 14.9 per cent stake in the company and raising about $70-80 million.

Wibur Ross, the buyout guru of distressed assets, is the frontrunner among these investors which also includes PE funds from US.

While this will be less complex than a buyout, it could be only a short term solution to meet the cash flow needs of the company.

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Britain’s Financial Services Authority has approved an application by the Anil-Ambani owned Reliance Asset Management (RAM) to open an office in London.

The company has launched an offshore fund ‘Emergent India’ targeted at international investors, according to the Wealth Bulletin, a Dow Jones-owned online service for the global wealth management industry.

RAM manager Sunil Singhania said: “The timing for marketing may not be right, but from an investment perspective it is just right. From these levels there is a great opportunity for investors, although there will also be some short-term dips.”

Singhania started raising his cash weighting in October in expectation of a market correction. He had 25 per cent in cash at the start of June, but has just started to put the money to work.

The online services reported that: “He (Singhania) likes capital goods and construction companies, where he has been underweight of late. With valuations in these sectors down by more than half, its stocks are starting to look attractive again.”

He also likes financial services companies on the grounds that India is under-banked, although he expects the next six months to be tough for the local economy. India is in danger of becoming a hostage to inflation, which has hit 11.4 per cent, due to the rising cost of fuel and food”, it added.

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The SpiceJet stake sale deal seems to be getting spicier with billionaire US based investor Wilbur Ross confirming that he is indeed in talks to buy a stake in the company.

The king of good times Vijay Mallya, the other prospective buyer, may need to match Wilbur Ross’s offer to get back into the deal.

SpiceJet has been looking for an investor in the company for quite some time to raise about $100 million by issuing fresh equity.

The company’s promoters were in talks with Vijay Mallya who is looking to buy majority stake in the company but Wilbur Ross’s interest in Spicejet can provide the promoters an easier way out of these troubled skies.

In an exclusive interview to NDTV, SpiceJet management confirmed that Rothschild is scouting for investors to invest in the airline.

“Our merchant bankers are in talks with PE and potential investors. We are waiting for merchant bankers to get back to management,” said Siddhanta Sharma, Executive Chairman, SpiceJet.

Sources tell NDTV that Vijay Mallya is not giving up yet and is expected to forward a formal proposal to the SpiceJet management possibly offering its promoters a complete buyout of their stake.

The low cost carrier’s management also doesn’t seem too averse to giving over management control in the airline.

“We don’t have a situation where people own 70-80 per cent of the company. It is not about control,” said Sharma.

The SpiceJet board is likely to meet this week to take a call on the various offers its bankers are putting forward with a formal announcement on the likely investor coming anytime next week.
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Reliance Retail today said it would launch the first outlet of its optical chain stores Vision Express, under a joint venture with Pearle Europe, by September this year in Bangalore.

“We have already got the necessary approval from FIPB. The first outlet will be opened by September,” Reliance Retail President and Chief Executive (Lifestyle), Bijou Kurien told reporters here.

On the sizes of the outlets Kurien said: “It will be smaller than our jewellery stores.” Earlier, Reliance Retail had announced the optical chain would comprise independent stores and stores within Reliance Retail’s other formats such as Hypermart, Super and Wellness.

The new entity would bring world class retail optical stores to India, with a range of private label frames, lenses, sunglasses, contact lenses and solutions.

Pearle Europe is a subsidiary of HAL Investments, the European investment subsidiary of HAL Holding NV, an international investment company based in the Netherlands Antilles.
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Maintaining a stoic silence over the fate of its agreement for exclusive talks with India’s Anil Ambani group firm RCom for an amalgamation deal, South African telecom giant MTN is likely to convene a board meeting on Thursday to discuss the issue.

Sources close to the development indicated that MTN could hold a board meeting to discuss the prospects of the possible deal, the 45-day exclusivity negotiations for which expired tonight, on July 10.

There was, however, no confirmation from either MTN or RCom on the status of the negotiations that could create an estimated 70-billion dollar combined entity, that has come into controversy following the legal issues raised by Mukesh Ambani-led RIL.

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Department of Telecom has scrapped its plans to auction 3G spectrum for CDMA operators even as it is close to finalizing the policy for 3G services for GSM operators.

Reliance Communications, Tata Teleservices, Shyam Telelink and Bharat Sanchar Nigam Ltd are the major CDMA operators in the country which were supposed to auction for 3G services. But DoT has blocked this option on the grounds that it will clash with the spectrum of GSM players, thus leaving 71 million CDMA subscribers face an undecided future with regard to the availability of third generation mobile services.

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Do you know how the fuel price is calculated in India?

Suppose if the petrol price per litre in Chennai is Rs 51.90, here the break-up of cost calculated by the  government:

Basic Price = Rs 21.93

Excise duty = Rs 14.35

Education Tax = Rs 0.43 Dealer commission = Rs 1.05 VAT = Rs 5.5 Crude Oil Custom duty = Rs 1.1 Petrol Custom = Rs 1.54 Transportation Charge = Rs 6.00

Total price = Rs 51.90

So for a Rs 22 litre petrol at pumps, consumers in India pay Rs 28 tax extra.[source]

The markets closed in the red yet again on Tuesday with both the Sensex and the Nifty closing below the psychological 13,000 and 3900 marks respectively. The Sensex closed at 12,961, shedding 500 points or 3.7 per cent. The Sensex closed below 13,000 levels for the first time since 5 April’07.
The Nifty also breached the 3900 mark to close at 3896 levels, 3.6 per cent down. The Nifty closed below 3900 for the first time since 12 April’07.
Heavy selling was witnessed across the board with all sectors closing in the red. Realty, banking and metal counters were the major losers of the day.

Yahoo Inc on Monday sought to rally shareholder support in the face of a proxy battle with billionaire Carl Icahn, saying the activist investor had an “ill-defined plan” for the future of the Internet company.

Yahoo detailed its rationale for rejecting a $47.5 billion takeover offer by Microsoft Corp, questioning whether the software maker was ever serious about a full-scale merger in a filing with the US Securities and Exchange Commission. “The record casts doubt on whether Microsoft was ever committed to a whole-company transaction,” the filing states.

Microsoft spokeswoman Jamie Moser fired back at Yahoo’s allegations that the software giant was not earnest in pursuing the deal: “This is simply revisionist history,” she said. Icahn is running a slate of directors to replace Yahoo’s board and has called for the removal of Chief Executive Jerry Yang ahead of the company’s annual shareholder meeting to be held in Silicon Valley on August 1. The activist shareholder has said the company should still offer to sell itself, though Microsoft has said it is no longer interested in a full buyout.

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Ambani siblings’ war intensified on Saturday with the younger Anil’s group warning to retaliate in case Mukesh-led Reliance Industries goes legal with its claim on the potential multi-billion dollar amalgamation deal that the former is pursuing with South African telecom giant MTN.
In a strongly worded reply to RIL’s threat to go legal against ADAG to enforce its right of first refusal, Anil-led Reliance Communications said, “If RIL chooses to take any legal action the same will be vigorously defended by RCom and RCom would claim cost and damages from RIL.”
The battle between the two richest Indians had flared up after RIL wrote to MTN and ADAG, copies of which were sent to the bankers, cautioning that the amalgamation deal through reverse swap would tantamount to breach of RIL’s first right of refusal to acquire a controlling stake in RCom.
The deal is estimated to create a combined entity worth a size of about $70 billion and could have operating profits higher than RIL, India’s biggest private sector firm.
Following up its strong criticism of RIL’s communication, ADA group company wrote a letter to RIL, saying, “There is no question of taking note of any alleged rights on RIL’s part.
RIL’s claim is legally and factually untenable, baseless and misconceived, to be dismissed with contempt it deserves.”
Though its spokesperson said that there was no change in RCom’s stand from what was stated earlier, the company sources said, “The use of threatening and coercive language by RIL, India’s largest private company, with MTN, a globally respected telecom major, is very unfortunate.”
They said “RIL’s action in sending copies of the letter to a large number of banks and intermediaries without even first communicating with RCOM reflects its ulterior and malafide motives.”
Terming RIL’s threats as “false bogey of litigation and damages,” the RCom sources expressed surprise that without knowing of the nature of a possible transaction between RCom and MTN, how RIL has jumped to the conclusion that it would be covered by the alleged agreement of January 12, 2006.
In its letter to MTN, RIL had said that as per the said agreement it has “a right of first refusal in respect of tranfer of shares of Reliance Communications Limited by the Reliance Anil Dhirubhai Ambani Group.”

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