While M&A due diligence is largely confirmatory, joint venture due diligence is informatory
For any joint venture to succeed, it is essential to conduct proper due diligence. An organisation must create an assessment model in due diligence, which will undertake a risk assessment by ... Views: 1939
The taxation regime for “Slump Sale” deals in India has always been a matter of differential judicial views and even before the advent of latest overhauled indirect tax structure, the position was scarcely settled when it comes to Slump Sale taxation rule. This Article, analyses and attempts to ... Views: 1072
ABC Bearings is engaged in the business of engineering, product design, manufacturing, distribution and sale of bearings including inter alia taper roller bearings (contributes over 80% of the total revenue- Mar 16), cylindrical roller bearings, spherical roller bearings and slewing bearings; ... Views: 1063
Leadership & Quotes: Ashish Hemrajani
Ashish Hemrajani has made life simple for avid movie-goers. With the click of a bottom, you can book movie tickets and reach the theater on time to enjoy the silver screen. The founder and chief executive officer of Bigtree Entertainment Pvt. Ltd, ... Views: 1057
Introduction:
In the case of merger and demerger, two dates are crucial, the "Appointed Date" and secondly the "Effective Date". Corporate managers spend a lot of time to plan the exact timing of these dates. ‘Appointed Date’ is normally arranged to secure the interests & objects of the ... Views: 1031
IDFC and Shriram Group have agreed to merge to create a financial conglomerate and offer various types of retail and corporate loans. The companies will finalise the deal within 90 days (from mid-July 2017). If the deal finally happens and gets all regulatory clearances, then it can create a ... Views: 985
In a consolidation move between group companies, Aditya Birla Chemicals Limited (ABCIL) merged with Grasim Industries Limited. The merged consolidated Aditya Birla Group’s chlor-alkali business into Grasim and strengthened its existing portfolio of viscose staple fiber, caustic soda and allied ... Views: 983
India is the second largest producer of textiles and garments in the world. The textile and allied product’s earnings from export was $37.14 billion in FY16, or 13.71% share of India’s total exports of $262.29 billion in FY16. Currently, the size of the textile industry is estimated at around ... Views: 977
In the Indian e-start-up business space, Quikr has become everyone's envy. The pace at which it is acquiring companies to grow and diversify is remarkable. Since January last year, it has acquired around 8 companies, and the latest, it is buying two arms of HDFC's brokerage business – HDFC ... Views: 946
While the agriculture sector may not be a major contributor to India’s GDP, India still ranks second worldwide in farm output. HP Nanda knew that the country which runs on agriculture can make his fortune by manufacturing product related to it (tractor). When tractors came to India through ... Views: 945
On June 12, 2017 Bengal and Assam Company Ltd announced the scheme of arrangement between Florence Investech Ltd., BMF Investments Ltd., J.K. Fenner (India) Ltd., and Bengal and Assam Company Ltd.
Bengal & Assam Company Ltd (BACL) is a public limited company incorporated in the year 1947. The ... Views: 943
Today the cement industry is going through a consolidation phase with large Indian cement players vying for smaller ones and foreign cement majors acquiring controlling stake in Indian majors. In a move to strengthen its position, Birla Corporation announced an acquisition of the entire cement ... Views: 935
The Indian chemical industry is at an inflection phase. Falling global crude prices, tough competition and weaker fundamentals will drive mergers and acquisition activities in the industry. While commodity chemicals will likely comprise most of the M&A activities, significant volumes are ... Views: 926
The year 2015 created a record in terms of global mergers and acquisitions (M&As). The total value touched $5.03 trillion, a massive rise of 37% ($3.67 trillion) from 2014, according to data from Dealogic. In fact, the total value of deals in 2015 was more than double of 2009, the year ... Views: 917
The enforcement of the relevant provisions pertaining to Cross Border Mergers contained in the Companies Act, 2013 by the Ministry of Corporate Affairs with corresponding provisions in Companies (Compromises, Arrangements and Amalgamation) Rules, 2016, including insertion of the Rule 25A and ... Views: 897
Signaling consolidation in the private banking space, IndusInd Bank and Bharat Financial Inclusion Ltd (BFIL), formerly known as SKS Microfinance, are in the final stage of merger talks. The two companies have signed an exclusivity agreement to hammer out a deal before the end of this financial ... Views: 888
Billionaire investor Prem Watsa-backed Thomas Cook India had acquired vacation ownership Sterling Holiday Resorts for Rs 870 crore, marking its foray into the hospitality sector. For Thomas Cook, it was the second purchase after Ikya Human Solutions in February 2013. The transaction was ... Views: 878
Drug firm Strides Arcolab Ltd has completed a sale of its specialties division Agila Specialties Pvt Ltd to the US-based generic drug major Mylan Inc for up to $1.75 billion. However, the company has agreed to Mylan holding back $250 million following a warning letter it received from the drug ... Views: 876
Proper due diligence at every stages will make the M&A a grand success
By planning the merger activity carefully and analyzing every issue that may arise, the target company will be better prepared to successfully consummate a sale of the company. The buyer is concerned not only with the ... Views: 869
Shareholders in a listed company are classified under two broad categories, i.e. those that belong to the promoter/promoter group and those shareholders who are members of the public with no family or formal business ties with the promoter/promoter group. SEBI vide Regulation 31A under Chapter ... Views: 862
About thirteen years back when an article was penned in this magazine ( ‘Bank Mergers - The fall out and shape of things to come’ –M&A Critique Issues October to December 2004), it was foretold that eventual mergers of Public Sector Banks (PSBs) in India was an economic necessity for becoming ... Views: 849
Innoventive Industries, India’s first company to be tried under the new Insolvency and Bankruptcy Code, has failed to finalize a debt resolution plan in the stipulated six months, prompting the National Company Law Tribunal (NCLT) to extend the deadline by another three months – the maximum ... Views: 847
The long time discussed subject of credibility of the resolution process under the Insolvency and Bankruptcy Code,2016, which is dependent on the sustainability of the Resolution Plan and credibility of the Resolution Applicant, is now settled by the Insolvency and Bankruptcy Board of ... Views: 845
NATIONAL SPOT EXCHANGE LIMITED
DRAFT ORDER ON AMALGAMATION OF NATIONAL SPOT EXCHANGE LIMITED WITH FINANCIAL TECHNOLOGIES (INDIA) LIMITED
Ministry of Corporate Affairs, on behalf of the Central Government, has issued a Draft Order on amalgamation of National Spot Exchange Limited with ... Views: 842
Term loans and advances as defined in Banking Regulation Act can be used interchangeably. The act defined “secured loan or advance" means a loan or advance made on the security of assets the market value of which is not at any time less than the amount of such loan or advance, and defined ... Views: 842
The Securities and Exchange Board of India (Sebi) has told the high court at Mumbai that it is investigating complaints against Financial Technologies (FTIL) and connected entities and promoters, including founder Jignesh Shah.
The complaints by investors of scam-hit National Spot Exchange ... Views: 834
Over the last decade, the Internet has changed the way of living of people. Due to the proliferation of Internet use, everything in the world is getting online. From Good Morning to Good Night, everything is available on the internet all you need is to ‘Google it”. India is no exception to it. ... Views: 828
Way back in December 2010, JSW Steel entered into an agreement with Ispat Industries Ltd to acquire 41.4% stake in Ispat at a price of Rs 19.85 per share for Rs 2,157 crore on a preferential basis. The funds were mainly used to improve the liquidity in the company and reduce the debt. Later on, ... Views: 818
The country’s third-largest software services company, Wipro has been acquiring companies to grow its digital technology strength. The company’s new chief executive officer (CEO) Abidali Neemuchwala had acquired two companies --- HealthPlan Services and Appirio last year for over $1 ... Views: 818
In September 2017, Ministry of Corporate Affairs (MCA) identified many directors associated with the companies that had failed to file financial statements or annual returns for a continuous period of three financial years 2013-14, 2014-2015 and 2015-2016 and consequently they became ... Views: 803
Introduction
Diversification today most executives and boards realize how difficult it is to add value to businesses that aren’t connected to each other in some way. Yet too many executives still believe that diversifying into unrelated industries reduces risks for investors or that ... Views: 792
Context of merger and rising NPAs
The steep rise in bad loans or non-performing assets (NPAs) of state-run banks has weighed on the economic development of the country as these banks hold more than two-thirds of deposits and advances in India’s banking industry. The 27 public sector banks ... Views: 791
Section 238 of the Insolvency and Bankruptcy Code, 2016, which is termed as a non-obstante clause is once again came into picture in the case of Power Grid Corporation of India Ltd. Vs Jyoti Structures Ltd, after its detailed analysis made by judiciary in the matter of Innoventive Industries ... Views: 780
Cognizant has successfully bought Us-based TriZetto for $2.7 billion in cash primarily owned by private equity group Apax. BlueCross BlueShield of Tennessee and Cambria Health Solutions, both minority shareholders, will also sell their stakes. Cognizant has financed the transaction through a ... Views: 778
While companies go for mergers to consolidate market share and strengthen geographical presence, small investors may not always gain much from mergers. Companies merge to improve the wealth of their shareholders, but it can affect the shareholders of both companies in different ways. The ... Views: 774
Healthcare has become one of India's largest sectors ‐ both in terms of revenue and employment in the country. The industry comprises hospitals, medical devices, clinical trials, outsourcing, telemedicine, medical tourism, health insurance and medical equipment. The healthcare industry is ... Views: 774
Bharti Airtel is engaged in the business of providing global telecommunications with operations in 17 countries across Asia and Africa. In India, the Transferee Company products Offerings include 2G, 3G and 4G wireless services, mobile commerce, fixed line services, high-speed home broadband, ... Views: 770
In February 2015, Infosys bought Panaya Inc., a leading provider of automation technology for large scale enterprise software management, for an enterprise value of $200 million (Rs 1,244 crore). The payment was upfront without any earn-outs and in the form of cash. The acquisition is in line ... Views: 758
Shares of Sun Pharma witnessed massive selling pressure, plunging over 16 percent after the drug major said it expects to take a hit on profit for the fiscal 2015-16 mainly due to integration process with Ranbaxy. The question which has been raised is as follows:
Whether the merger is ... Views: 752
A 1994 report from Department of Economic Affairs, Ministry of Finance found a lack of specialised financial intermediaries offering funds for infrastructure projects. This lead to the birth of IDFC Limited (IDFC) on January 30, 1997. In 1998, the company registered with Reserve Bank of India ... Views: 749
LEGAL CORNER - February 2016 - CASE LAW:
Topic:
Goodwill value cannot be challenged where slump sale includes the sale of goodwill & such agreement is beyond any doubt.
Facts of the Case:
The Assessee Company (formerly known as “Saijem Triune Energy Pvt. Ltd.) was incorporated during ... Views: 747
While there are several valuation techniques, one must choose the one which suits the both the buyer and the seller.
Valuation in any merger is the amount a buyer is willing to pay the seller and if the latter is willing to accept the deal amount. There are different techniques to value a ... Views: 745
Facts of the Case
NDTV along with its Subsidiaries entered into an agreement dated 23.05.2008 with NBC Universal Inc and Universal Studios International BV, as a result of the same, INR 642.54 cr (9,15,498 Shares @ INR 7015.05 per share) was received by NNIH, for allotting shares to NBC ... Views: 740
In order to bring in efficiency in the way of functioning of public sector undertakings, the government is taking the merger routs. The Cabinet has approved the merger of SBI with its five associates, all state-owned oil companies will become one, and now, the government’s six consultancy firms ... Views: 734
Class Action Suit became reality for Indian investor(s)/depositor(s) under new Companies Act, 2013 which is also known as Representative Suit. This kind of lawsuit is very popular in countries like USA, UK, Singapore, Canada, Austria and other European Countries. Class Action Suit gained ... Views: 727
The Insolvency and Bankruptcy Code 2016 aims at reviving companies that are going for liquidation. If reviving the company is not possible, the code will enable to liquidate the company in a judicial and rational manner so that it serves the interests of all stakeholders and the public at large. ... Views: 727
A panel of Ministers called the EGoM (Empowered Group of Ministers) approved the final draft of the much-awaited merger & acquisition (M&A) guidelines for the Telecom sector which are likely to support the consolidation of the Telecom companies. The M&A guidelines will now be sent to the Union ... Views: 725
The Companies Act 2013 (New Act), which was substantially made effective from April 1, 2014, has the potential and capability to be a historic milestone for implementing Mergers & Amalgamations(M& A). So far, the provisions relating to M&A under the New Act are yet to be notified.
These are ... Views: 723
Shareholders are the owners of the corporations. Shareholders have the right to access and examine the corporate records and information concerning the governance and financial performance of the corporate. With the changing time, shareholders are increasing their active engagement in the ... Views: 721
The management of the company doing the acquisition must have a clear and well-defined strategy for their specific business
In order to make a merger work, it is pertinent to have a sound strategic planning so that maximum benefit is taken out from the merger. Before signing on the dotted ... Views: 719