Mukesh Ambani sets up Reliance Industries Holding to park personal investments: Sources

21st March 2012,Wednesday

India's richest man and Chairman of Reliance Industries, Mukesh Ambani has embarked on a massive restructuring of his personal investments worth billions of dollars by setting up a holding company called Reliance Industries Holding Pvt Ltd. The idea is to reduce cross holdings and streamline the portfolio of Mr Ambani, a source close to the development said.

Mukesh Ambani has invested in a gas pipeline company Reliance Gas and Transportation Ltd, a Jamnagar-based power company Reliance Utilities and in Reliance Ports and Terminal Ltd which also handles handles crude import, petrochem exports needs of Reliance Industries Ltd.

All these companies, in turn, hold stake in various quoted and unquoted companies. As a first step, the investment division of Reliance Ports and Terminals Ltd will be hived off as a separate company. It will then be merged with Reliance Industries Holding Private Ltd. The source said a petition with the Gujarat high court has already been filed by Reliance Port and Terminals Ltd to demerge its investment division. The merger is effective from February 1 this year.

A similar exercise with Reliance Gas and Transportation Ltd and Reliance Utilities and Power Ltd is also expected in the coming months, the source said.

When contacted, a Reliance spokesperson declined to comment on the article saying all these companies are unlisted and private companies. Mukesh Ambani owns India's biggest private sector company Reliance Industries Ltd which is listed in the stock exchanges.

Apart from this, Mukesh Ambani has several companies which are owned 100 per cent by him. The source said the holding company will help synergise investments of all the companies and give tax breaks to the holding company on losses, if any.

What is interesting is that for the first time Reliance Port and Terminal Ltd has reported a Rs 12,300 crore impairment in its investment portfolio. The source said these losses are notional and before merging the investment division with the holding company, Ambani has decided to write the losses off. The losses have been made due to investments made in various listed and unlisted stocks, the source said. The RPTL's investment portfolio, worth Rs 10,200 crore after the write off, will be merged with the holding company, the source said.

ONGC to invest Rs 200 crore for exploration projects in Bihar

21st March 2012,Wednesday

The Oil and Natural Gas Corporation (ONGC) will invest Rs 200 crore in two projects of oil and gas exploration in Bihar's Kishanganj district over the next three years.

This was announced by ONGC's Chief Engineer and Land Acquisition Officer D P Vishwas here today.

The company was finalizing an agreement to take six acres of land on lease in Gargaoin panchayat under Kochadhaman block and Korat Bangama panchayat under Bahadurganj block for the projects, he said.

The drilling for up to five km will be carried out from April to explore oil and natural gas resources in the identified areas, the ONGC official said, adding that the construction of roads upto drilling sites has commenced.

Tech Mahindra, Mahindra Satyam boards approve merger at swap ratio of 2:17

21st March 2012,Wednesday

The boards of Satyam Computer Services Ltd andTech Mahindra Ltd, IT services providers of the Mahindra group, approved the merger of two companies, according to TV reports. The exchange ratio for the merger was pegged at 2:17 ratio i.e. 2 shares of Tech Mahindra will be given for 17 shares of Mahindra Satyam. After merger 204 million equities will be transferred to trust.

Shareholders will get one share of Tech Mahindra for 8.5 shares of Satyam, the companies said.

The merger will result in combined revenue of about $2.4 billion and more than 350 clients across different geographies and industrial sectors, Tech Mahindra said in a statement on Wednesday after a board meeting to approve the merger.

The move ends a tumultuous journey for Satyam, which had come on the brink of collapse after its former chairman and founder Ramalinga Raju said in January 2009 that profits had been overstated and assets falsified in the country's biggest accounting fraud.

The merger between technology outsourcing firmsMahindra Satyam and Tech Mahindra will lead to the constitution of a new management structure to guide the combined entity, two sources close to the development told ET.

CP Gurnani, who has been credited largely for Satyam's profitability post the takeover by Tech Mahindra will continue to lead the amalgamated firm as its chief executive officer. Vineet Nayyar, who mentored the top leadership through transition as Chairman, will assume a non-executive role once the company stabilizes, absolving himself of overlooking the day to day operations of the company. Sanjay Anand, a Tech Mahindra strong hand will be chief financial officer.

Employees will be permitted to shift across verticals and services after a minimum service period of 18 to 24 months.

Mahindra Satyam is likely to hire a firm to advise the combined entity on operational issues and matters pertaining to strategy and human resources.

Shares of Tech Mahindra surged over 3% on Wednesday. At 10:15 a.m., shares of Tech Mahindra Ltd were trading 3.5% higher at Rs 671.05. The stock has hit a high of Rs 680 and a low of Rs 649.40.

Commenting on the merger Anand G Mahindra, Chairman, Tech Mahindra said "This merger will help propel the combined entity into the top tier of Indian software and services companies, achieving the group's key objective of being in a leadership role in each of our focus business areas."

Kingfisher Airlines to stop all international flights by April 10

20th March 2012,Tuesday

Vijay Mallya led cash-starved Kingfisher Airlines will shut all international operations by April 10 2012. The last flight under its international operations' division, on April 10 will be a Delhi-Heathrow one.

Flights to Dubai, Colombo, Kathmandu, Bangkok will stop operating by Sunday, March 25, 2012. The ailing airline has already shut shop for its Hong Kong and Singapore divisions. A mail sent by ET Now to Kingfisher Airlines has not yet revealed any response. However, the Airline had in the past expressed the intention of curtailing its international operations.

On the other hand talks between the pilots and the management of Kingfisher Airlines are said to have been inconclusive. According to ET Now sources, the management seems to have indicated that employees would be given a one month salary once the Income Tax (I-T) department de-freezes its accounts. However, with employees demanding their three months pending salary, no solution seems to have been arrived at.

Meanwhile, Civil Aviation Minister Ajit Singh told reporters that the government may cancel Kingfisher Airlines' licence if safety norms and financial viability conditions are not met.

The carrier, which is now operating 18 planes, has failed to stick to its recovery plan, Singh said. Kingfisher Airlines, which has a debt of $1.3 billion, is facing collapse as banks have refused to lend more for day-to-day operations. Massive cutback in flights have reduced revenues, leaving the carrier with little cash to pay its employees, airports and tax authorities.

Shares of Kingfisher Airlines Ltd plunged to their 52-week low on Tuesday. Kingfisher shares dived over 11% percent to Rs 17.50 to its 52-week low in early trading on the National Stock Exchange. They had earlier recovered to Rs 18.9, down 5.9 per cent.

Kingfisher Chairman Vijay Mallya will meet aviation regulator on Tuesday or Wednesday to discuss the recovery plans, Singh said.

More curbs if gold imports don't shrink

20th March 2012,Tuesday

If Indians continue to buy gold the way they have done, the government may think of more drastic measures than the taxes imposed in the budget, such as restrictions on imports.

India's import of gold rose 54% in April-December this year from a year ago to $45.5 billion, contributing to the record trade deficit in the current year, pegged at $160 billion in the first eleven months.

"If CAD (current account deficit) crosses 3.5% (of GDP) we will have to think of cutting down some imports," Finance Secretary RS Gujaral said in Delhi on Monday, hinting at gold. Increase in tax on gold in the budget is essentially aimed at narrowing the current account deficit, he said.

India was largest consumer of gold in 2011 with total demand of 933.4 tonnes, according to the World Gold Council, down only moderately from 1,000 tonnes in 2010 despite record high prices. The high inflation has also prompted many investors to switch to gold from financial savings.

The share of financial savings in the overall savings of households has dropped to 44% in 2010-11 from 52% in 2007-08. The budget has doubled the basic customs duty on gold bars, the second increase in the last two months, in an attempt to moderate the demand.

"One of the primary drivers of the current account deficit has been the growth of almost 50% in imports of gold and other precious metals in the first three quarters of this year," finance minister said in his budget speech justifying the levy.

The budget has also imposed a tax at source on purchase of jewellery in excess of Rs 2 lakh in cash. The C Rangarajan-headed prime minister's economic advisory council (PMEAC) has in its review of the economy also called for measures to discourage gold consumption and shift people to financial savings.

India is expected to end the year with a current account deficit of 3.6% of GDP, which has put pressure on the rupee and raised concern among foreign investors.

AMAZING CARS

20th March 2012,Tuesday


AMAZING CARS

Bentley EXP 9F Luxury SUV

Price: $250,000

Bentley Motors Limited is a British manufacturer of automobiles founded on January 18, 1919, by Walter Owen Bentley.

Purchased by Rolls-Royce in 1931, when production was moved from London to Derby and later to Crewe, this business has been owned by the Volkswagen Group of Germany since 1998.

Porsche Boxter S

Price: $70,000

The Porsche Boxster is a mid-engined roadster built by Porsche. The Boxster is Porsche's first road vehicle to be originally designed as a roadster since the 550 Spyder.

Aston Martin V12 Zagato

Price: $519,400

The Aston Martin V12 Zagato is an endurance racing concept car made by Aston Martin in collaboration with Zagato to celebrate a 50 year partnership since the Aston Martin DB4 GT Zagato.

Sleeping for a living in five-star hotels

20th March 2012,Tuesday

A woman in China has been hired to stay in five-star hotels and rate the services offered by the staff.

She was selected out of 7,800 candidates and has stayed in more than 200 hotels until now.

Zhuang sleeps on the bed as she shows a part of her job as a Hotel Test Sleeper at a boutique hotel in central Beijing.

Zhuang was selected as one of three final winners out of 7,800 candidates and started working for Qunar as a Professional Hotel Test Sleeper in March 2010.

Zhuang checks a tea cup at a business chain hotel, in Beijing. At present, she has slept at more than 200 hotels.

"My job is to role-play travellers of different types, different ages and genders at different scenarios, and see how each hotel fits their particular needs." Zhuang says.

Zhuang checks the bed of a Beijing traditional hotel with courtyard houses, known as "Siheyuan" in Chinese, in central Beijing.

Her reviews help travellers make smart hotel picks and bring them a more pleasant experience on the road. Qunar, a Chinese online travel platform, started to recruit Professional Hotel Test Sleepers in 2010.

Zhuang checks the texture of the toilet paper at a business chain hotel, in Beijing. The requirement for this new profession is to sleep at selected hotels without disclosing their real job and write expert reviews about the facilities, location, dining, services and prices of the hotels, in order to provide an independent third-party evaluation and an authoritative guide to travellers, according to the company. 

Zhuang looks back at an entrance of a Beijing traditional hotel with courtyard houses, known as "Siheyuan" in Chinese, in central Beijing.