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Norms on merger
in telecom Discount likely
to retail investors on
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Call centre to be
set up in Srinagar HSBC-union pact
on outsourcing Sale of govt
stake in CMC opens on Feb 23 Kerala imposes
ban on Coke plant HC notice to UTI
on closure of children’s scheme Preferential
shares for ONGC shareholders Airtel increases
talk time Cingular buys
out AT&T for $41 b Vodafone bows out
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Norms on merger in telecom soon: Shourie New Delhi, February 17 “The matter of intra-circle mergers and acquisitions will be put up to me tomorrow or day after and I will be able to report on it in two days”, Communications and IT Minister Arun Shourie said at the Gartner Telecom Summit here. Mr Shourie, however, refused to commit whether the government would accept the recommendations made by Trai in totality. In its recommendations on intra-circle mergers and acquisition guidelines, Trai said the market share of the merged entity should be greater than 50 per cent and the concentration ratio of top two firms in a post-merger scenario should be greater than or equal to 75 per cent. It has also said a minimum of three players were needed for a merger to take place. Also there should be no serious prospect of restructuring the business without the merger. The merging parties should take up the responsibility that the condition of the “failing company’’ must improve. Regarding the politically contentious issue of increasing the FDI limit in telecom services to 74 per cent from the present 49 per cent Mr Shourie evaded a direct reply and said : “it is a matter to be addressed after the elections depending on the government portfolios”. “Only the Prime Minister and the Deputy Prime Minister can decide”, he said. The Group of Ministers on Telecom had approved on September 25 last year a hike in FDI limit to 74 per cent, subject to management control remaining in Indian hands. In the wake of the recent backlash towards Indian business process outsourcing companies from the US, Mr Shourie said a multi-faceted approach should be adopted by the domestic IT companies and look at the opportunities in other countries also. “The Commerce Minister has stated that the government’s position on the issue and the country’s position is well known. It cannot be that developed
countries start putting non-tariff barriers against us in areas where we have strengths”, he said. He pointed out similar instances of non-tariff barriers being erected by the developed world earlier also. “It happened in the case of bed linen, marine products, steel in the US and now it happened in BPO”, he observed. Mr Shourie observed that this was expected as the US goes into election this year. Urging Indian IT companies to diversify and expand, the Minister said the services should be such that American companies convince their government that their competitiveness would erode if they stopped outsourcing from India.
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Discount likely to retail investors on PSU shares New Delhi, February 17 “The government has always wanted to reward small investors. But what extent of discount there is and whether there is a lock-in period all that will be in our proposal to the Finance Minister,” Disinvestment and Communications Minister Arun Shourie told newspersons here. Mr Shourie was speaking to newspersons on the sidelines of the Gartner Telecom Summit here. In all possibility a differential pricing method would be adopted, the logic being that the companies belong to different industrial segments. “Each of these companies are so different that we will have to do different things... Do not hold me to a particular standard. We will have to craft the things in different ways,” Mr Shourie said. The road show for the IPCL public issue kicked off at Mumbai today and the minister said that the price band would be announced at the close of the market on the preceding day. “The price band will be announced on evening of February 19. As in case of Maruti, we do it at that time. I will report to the Finance Minister to get his concurrence and guidance and then we will announce. We will do it after market closes,” Mr Shourie said. He also said that the public issue of Gail would offered in the domestic market. This would be done keeping in mind the fact that the disinvestment figures had already been factored into the Vote-on-Account estimates.
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Call centre to be set up in Srinagar New Delhi, February 17 The Kohinoor group that has business interests in construction, fruit exports, and agri-food products, has signed an MoU with the Source Corporation, USA, to set up a 600-seat call centre, said Mr Altaf Bukhari, managing director of the company. Talking to the TNS today, he said that the company would make an investment of Rs 30 crore in the project, which would cost about Rs 45 crore. The rest of amount would be invested by the foreign partner. He said, “It will be a first major IT project in the Kashmir valley. Apart from creating jobs for the educated youth, it will help the state government attract other IT and IT-enabled service companies.” Mr Bukhari said first 100 seats of the call centre would be functional by August, this
year. The company would soon start recruitment for the project. Regarding the availability of skilled manpower, he said, “There is no dearth of highly-skilled computer-savvy youths in the valley. Further we will provide on-job training to them after recruitment.” The call centre would deal with the customers of insurance companies based in the USA. In view of strong opposition to the outsourcing in the USA and to ensure quality customer services, he said, the Source Corporation would also have supportive infrastructure in Texas. It would enable the customers to get additional information and services if required, in their own country. Mr Bukhari, a resident of Kashmir, who has now settled here, claimed that the political stability in the state and recent announcement of New Industrial Policy by the state government had created an environment for investment. He said: “Wide spread unemployment among the state’s educated youth has remained a major cause of political instability. We want to contribute for the development and peace in the state by creating new job opportunities.” The Kohinoor group, which is running an apple-juice plant at Rangret, near Srinagar and an agro-chemical unit in Jammu, had also decided to invest in the agri-food business. Mr Bukhari said, “In the next three years, we will invest Rs 100 crore to set up an integrated cold stores’ chain, an apricot drying and packaging unit and a tetrapack-packing juice line.” He urged the state government to launch a ‘fast-track policy’ to facilitate the large-scale investors to implement the project at the earliest.
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HSBC-union pact on outsourcing
London, February 17 Last October HSBC decided to move 4,000 jobs from the UK to India, Malaysia and China over the next three years, which had caused severe unrest here. Mr Rob O’Neill, a Unifi official, said: ‘’We are confident that our objective of keeping compulsory redundancies to an absolute minimum can be achieved.” According to the agreement, a process to secure redeployment for those who wish to remain with HSBC will be set up and the process will be managed with Unifi input at both the local and national level. Unifi claimed the deal will also give it access to early decision making and the scope to cut down job losses. “The agreement gives Unifi an enhanced opportunity to influence the bank’s decisions, including the possibility of retaining work and jobs in the UK. We believe it sets a new benchmark in relation to arrangements for consultation,’’ said Mr O’Neill.
— UNI
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Sale of govt stake in CMC opens on Feb 23
Mumbai, February 17 The price band of the offer will be announced only a day before the opening date of the bid, he said. The offer is being made through a 100 per cent book- building process, wherein up to 50 per cent of the offer will be allocated on a discretionary basis to qualified international buyers, he said. Further, not less than 25 per cent of the offer will be allocated on a priority basis to non-institutional bidders (NIBs) and not less than 25 per cent of the offer will be for retail bidders, subject to valid bids being received at or above the offer price, he added. HSBC Securities and Capital Markets (India) Pvt Ltd and Enam Financial Consultants are the book- running lead managers of the issue. At present, the Tatas hold a 51.3 per cent stake in the company, public and others hold 22.4 per cent, while the remaining 26.3 per cent is held by the government.
— PTI
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Kerala imposes ban on Coke plant
Thiruvananthapuram, February 17 Briefing reporters after a Cabinet meeting, Chief Minister A K Antony said the government had taken the decision in view of the unprecedented drought in that district. Stating that the ban would come into force with immediate effect, he said the Palakkad District Collector had been directed to hold talks with the company on the running of the bottling plant in the context of the decision. Asked whether a similar ban would be imposed on the Pepsi bottling plant at Pudusseri in the same district, the Chief Minister said no decision had been taken with regard to the Pepsi plant. Mr Antony said drought relief measures would be taken on a war-footing in the district. Coca-Cola, in a press note issued here today said “the matter is sub judice. We will decide our future course of action after we receive an official communication from the government. Any discriminatory and extreme steps against our plant by the Kerala Government will be unwarranted and unjustified as the entire matter is pending before the Kerala High
Court. — UNI
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HC notice to UTI on closure of children’s scheme
Jaipur, February 17 A division Bench, comprising Chief Justice Anil Dev Singh and Justice Harbans Lal, issued the notices yesterday on the PIL filed by journalist Milap Chand Dandia. Arguing before the Bench, the petitioner’s counsel Manish Bhandari said the scheme, started in 1986 on a promise of an assured return, is being closed from April 1 this year leaving lakhs of investors in a lurch. He said closing the scheme midway amounted to breach of promise.
— PTI
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Preferential shares for ONGC shareholders
Mumbai, February 17 Informing the BSE, the ONGC said the government has decided to keep up the number of equity shares reserved for the shareholders of the company and the shareholders of its subsidiary, MRPL.
— UNI
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Airtel increases talk time
Chandigarh, February 17 Mr Vinod Sawhny, CEO and Director, Mobility, Bharti Mobile Ltd, said the lower denominations coupons would have an increased validity, enabling customers to talk more. The new initiative would benefit 4.5 million prepaid customers. Nearly 80 per cent of the total mobile users are prepaid, he said. The validity period now for the Rs 54 value recharge coupon will be five days instead of three, for Rs 108 it will be 10 instead of seven days and 20 instead of 14 days for the Rs 216 coupon.
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Cingular buys out AT&T for $41 b
London, February 17 Cingular — the second-largest U.S. mobile phone group, owned by regional carriers SBC Communications Inc and BellSouth Corp — said it bid $15 per share for third-ranked AT&T Wireless, clinching a four-day auction. The new, enlarged US mobile phone group overtakes market leader Verizon Wireless in terms of customers with a subscriber base of 46 million and combined annual revenue of more than $32 billion, Cingular said in a statement. “This combination is expected to create customer benefits and growth prospects neither company could have achieved on its own and will mean better coverage, improved reliability, enhanced call quality and a wide array of new and innovative services for consumers,’’ said Stan Sigman, president and chief executive of Cingular. Cingular said SBC and BellSouth expected the deal to be dilutive to net and cash earnings per share in 2005 and 2006, and to boost cash earnings per share in 2007. The group said the enlarged group would generate positive free cashflow in 2005. The takeover of AT&T Wireless, which put itself up for sale last month, signals the start of long-awaited mergers in the fiercely competitive US mobile industry, in which six national brands and a handful of regional players are battling for market share.
Vodafone bows out
As shares in Vodafone surged in relief it had not been stuck with an earnings-dilutive deal, the world’s largest mobile phone group by revenue announced it had withdrawn from the auction and would instead stick to its 45 per cent stake in the top US mobile phone company, Verizon Wireless. “On February 17, 2004, Vodafone withdrew from the auction when it concluded that it was no longer in its shareholders’ best interests to continue discussions,’’ the company said in a statement. Sources close to the sale of the third-largest US mobile phone group told Reuters overnight that Vodafone had considered offering up to $39.4 billion, or $14.50 per share. Vodafone’s shares leapt almost 7 per cent on Tuesday to 141.75p. “We are fully supportive of Vodafone’s decision to withdraw from the bid process,’’ Karen Robertson, investment director at Standard Life Investments, which owns just over 2 per cent of Vodafone, said in a
statement. — Reuters
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PTL chief Yash Mahajan
Chandigarh, February 17 |
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