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Sterlite to buy US-based Asarco for $2.6 billion
BlackBerry Row |
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Indian fragrance goes global
BSNL public offer could face union trouble
ATF prices up 18.5%
Aviation Notes
Investor Guidance
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Sterlite to buy US-based Asarco for $2.6 billion
Mumbai, May 31 Asarco, formerly known as American Smelting and Refining Company, is the third largest copper producer in the US. "We are delighted to have reached at agreement on this important acquisition, which is a significant milestone for our group," Sterlite's chairman Anil Agarwal said in a release. The agreement is subject to the approval of the US Bankruptcy Court for the Southern District of Texas, Corpus Christi Division, the release said. A Sterlite official told PTI that it would take six to seven months to complete Asarco, which filed for bankruptcy protection in 2005, following sued for $1 billion over environmental issues, produced 2,35,000 tons of refined copper in 2007. However, its mines have estimated reserves of five million tons of contained copper. Asarco operates mines, mills and a smelter in Arizona. It also has a smelter and refinery in Texas. For the year ended December 31, 2007, Asarco had reported a revenue of around $1.9 billion. Sterlite has a capacity of 4,00,000 tons per annum (tpa) of copper annode and 2,40,000 tpa of copper rod in its Silvasa and Tuticorin facilities. Sterlite said the acquisition would be financed through a mix of debt and existing cash resources. The company official, however, said that Sterlite was yet to decide anything on the debt portion. The asset acquisition is on a cash- free and debt-free basis. Sterlite will assume operating liabilities but not legacy liabilities for asbestos and environmental claims for ceased operations. "Asarco is a logical and strategic fit with Sterlite's existing business and is expected to create significant long-term value for all shareholders through leveraging Sterlite's proved operational and project skill to develop and optimise Asarco's mines and plants and access to attractive mining assets with long life," the release said. Geographic diversification in North America market and stable operating & financial platform of Asarco would also add to shareholders' value, it claimed. This acquisition by Sterlite would be the largest overseas acquisition so far in terms of value by an Indian company during the year. In March, Tata Motors had entered into a $2.3 billion agreement to buy Jaguar and Land Rover brands from Ford. Tata Steel's $13 billion Corus acquisition in 2007 is the largest ever overseas buy by an Indian company. ABN Amro Corporate Finance acted as financial adviser and Shearman & Sterling acted as legal adviser to Sterlite in the transaction. Asarco has around 2,600 employees. — PTI
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FM asks banks to fund MSEs
Mumbai, May 31 Releasing the Code of Banks' Committment to Micro and Small Enterprises (MSEs), the minister said
that the MSEs must receive the same assistance as the "It is the duty of banks to help and nurse these micro and small enterprises...which are dependent on unscrupulous moneylenders," Chidambaram said. The minister pointed out that even low-paid employees were better off than entrepreneurs who were running micro and small enterprises. The minister pointed out that micro and small enterprises played an important role in an economy like India and were among the biggest employers. "The kind of jobs they offer may not be good, regular or "decent". But still they offer many jobs to people with little education, training and skills," he said. Chidambaram compared the plight of big industries with MSEs. "When an industry like steel goes through a period of crisis as it did five to six years ago, all agreed that industry should be bailed out. But when MSE fails because of no access to credit, hardly anyone expresses concern," he said.
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BlackBerry Row
New Delhi, May 31 While reports suggested that DoT would not curtail the services of the BlackBerry in the country because of the security issues, the RIM is said to have pointed out to the telecom department that there were at least three to four other manufacturers who provide e-mail facilities on their handsets with strong encryption. RIM had yesterday said it was hopeful of an amicable settlement to the issue and had assured its customers that the services would not be curtailed. RIM is said to have pointed out that it was only BlackBerry which was being targeted while similar services, with ‘comparable encryption levels’ were being offered by other handset manufacturers in India, including Nokia and Motorola. It also said some of the software companies were also in a position to offer similar services on mobile handsets. Thus, focusing alone on BlackBerry would not solve the security concerns over encryption, the RIM officials are said to have informed the DoT during their presentation. “In addition to BlackBerry, four other mobile email solutions in market in India use comparable encryption levels -ActiveSync, Nokia Intellisync, Motorola Good and Seven Networks ,” RIM said. It further pointed out that several other technologies widely used in India use strong encryption to secure communications over the Internet. All these technologies are widely available and used throughout India, RIM officials said while adding that functionally, all of these solutions use encryption similar to BlackBerry.
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Indian fragrance goes global
Puducherry, May 31 SAUT's unit aptly named, “Cottage Industries” is one of the authorised suppliers of hand-rolled incense sticks to the ITC that has launched incense sticks under a common brand, “Mangaldeep” with the guidance and support of country's premier export finance institution, Exim Bank. The product has been successfully launched in Singapore, Malaysia, Nepal, the UAE, Bahrain and the US and ITC is on the lookout for newer markets in the global arena. Cottage Industries specialises in manufacturing traditional and natural incense sticks without using harmful chemicals and on an average supplies 15,000 to 18,000 packets (a packet contains 20 sticks) of different fragrances to ITC alone. It has also been accredited with the prestigious certification from the International Fair Trade Association (IFAT) for following fair trade practices. According to Cottage Industries manager Manoj Tagore, “As IFAT members, we can use FTO mark as logo in our products, which gives our products an edge in the competitive global market. Consumers, particularly in the US and Europe, prefer products from suppliers recognised internationally for their fair trade practices.”
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BSNL public offer could face union trouble
New Delhi, May 31 The union of the state-owned company has refused to accept the proposal for the IPO even if stock employee options were introduced under the recommendations by the second PSU pay revision committee. The listing of the PSU has earlier also reached a snag due to the opposition by the unions. BSNL is looking at bringing an IPO, which would be the mother of all IPOs till now at a value of about Rs 60,000 crore. |
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New Delhi, May 31 The ATF price charged from airplanes has been raised to Rs 69,227.08 per kilolitre (kl) in Delhi from midnight tonight, an Indian Oil Corp, the nation's largest retailer, said. Till today it was priced at Rs 58,387.92 per kl in Delhi. In Mumbai, which has the country's busiest airport, jet fuel prices have gone up to Rs 76,625.68 per kl from Rs 64,824.82 per kl. This is the fourth straight hike in ATF prices since February 2007. State-run fuel retailers IOC, Bharat Petroleum and Hindustan Petroleum revise prices of jet fuel once every month in line with international trend. — PTI
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Aviation Notes
In most countries worldwide, a passenger is considered a valued customer. He is rated as airline’s ‘financial muscle’.
There is no class distinction; none is taken inferior to another passengers. These are the abiding directions to the staff on ground and cabin crew of flight. If the passenger happens to be a ‘paraplegic’, he is provided a ‘VIP’ status as a ‘VIC (Very Important Contact)’. He is handled meticulously and provided all facilities so that his flight is enjoyable. As per aviation norms, every airline is compelled to ‘overbook’ because every seat wears ‘revenue slot’. The airline takes into account that no passenger is off-loaded. If such an eventuality arises, the senior staff obtains passenger’s consent and he is provided cash compensation on the spot, in addition to transport, lodging and boarding, if required by him. Sadly, reverse is the situation in this country. Recently, a paraplegic, a renowned wheel-chair tennis player, Salil Chaturvedi, was abandoned for more than an hour while flying from Chennai to Delhi by Spicejet airline. What was worse was that he was not even provided his wheelchair and was carried like a ‘baggage’ by untrained porters. On Chaturvedi's return from Delhi to Chennai, the situation was no better. He was again denied ‘priority boarding’ and his urine bag was also ‘taken away’. "I felt ashamed as my trousers were slipping and all aghast passengers were feeling sympathetic at my poor plight", said Chaturvedi, who participated in Australian Open (Wheelchair) recently. This is not the first time paraplegic passenger has been treated harshly nor it This is because the rules are soft and the law-enforcers are softer. The analysts say that the staff guilty of mistreating a paraplegic passenger should be dealt with severely and the airline warned. During the peak season — 2-3 times a year — the passengers holding confirmed bookings being off-loaded is a regular occurence. Forget compensation, the off-loaded passenger is treated like a ‘rotten cargo’. If he belongs to ‘labour class’ or he has no ‘mai-baap’, he is not even heard. He is denied transportation and left to fend himself. All this has been happening because of red-tapism. The law enforcers, that is DGCA, will have to act tough so that the carriers, particularly no-frills airlines, adhere to the rules formulated by the DGCA. The DGCA has to formulate rules regarding ‘mishandled baggage’ so that harassed passengers are not made to toss about for retrieving their ‘mishandled’ suitcase. |
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Investor Guidance
Q: My wife and I are NRI working in the US. Before we left for US, my wife had a PPF account and fixed deposits and I have an ULIP which has just matured. Both of us have acquired US citizenship. In the situation - A: 1. NRIs are prohibited from opening a PPF account or investing in any of the Post office schemes as well as the RBI savings Bonds. However, if a resident who subsequently becomes NRI during the currency of the PPF term or an NRI who has opened the account before the date of this notification (GSR 585(E) dt 25.7.03) may continue to subscribe till maturity on a non-repatriation basis. This means, they cannot open a new account or extend the scheme beyond its maturity. 2. Yes, you may deposit the ULIP maturity amount in your NRO account.
The interest on NRO is fully taxable at the rates applicable to Residents. TDS is chargeable on the entire interest without any basic exemption. The rate applicable is @30.9% (plus surcharge if any) and it cannot be avoided. TDS is also applicable on accrual basis on cumulative deposits. If your final tax liability is lower than the TDS amount, the only practical recourse open is to claim refund by filing tax returns. LTA and FBT
Q: Is the LTA paid to employee taxable as Fringe Benefit Tax in hands of employer? A: Vide F. No. 142/21/2005-TPL the Ministry of Finance, Department of Revenue, Central Board of Direct Taxes have released detailed explanatory notes on the provisions relating to Fringe Benefit Tax. Further, the Ministry has clarified that LTA is outside the purview of FBT. In other words, if the LTA forms a part of the salary package of an employee (which it does in most cases), irrespective of the exemption claimed in any year, such LTA will not be subject to FBT. However, if any other form of LTA is given by the employer, then the same would be envisaged as an FBT item. For example, as an incentive for achieving a certain level of business or for an extraordinary performance manifests itself in gratuitous holiday bestowed by the employer on the employee. So far, the expense on such profligacy escaped tax altogether — i.e. the same was not taxable either in the employee’s hands or the employer’s. In fact, the employer would claim such expenses tax deductible by classifying the same into travel & tour expenses or conveyance etc.
The Finance Ministry has clarified that it is only such holiday expenses that are envisaged to be taxed and not the regular LTA that an employee receives. Equity-based MF schemes
Q:I have a following query related to mutual funds Investment. A: Equity-based MF schemes are governed differently from the debt-based schemes. In both the cases, dividend is tax-free in the hands of the investor. However, there is a dividend distribution tax @14.1625% payable by the MF directly to the exchequer in the case of debt-based whereas the equity-based are exempt from this tax. Equity-based schemes are also exempt from long-term capital gains tax. The short-term capital gains are taxed @15% only.
In the case of debt-based schemes, short-term gains are treated as normal income of the assessee and taxed at the rates applicable to the assessee. The long-term gains will attract tax @10% without indexation or @20% with indexation, whichever is more beneficial to the assessee. The authors may be contacted at
wonderlandconsultants@yahoo.com |
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