ECONOMY

Essar group to acquire US steel maker for $1 b.

New Delhi: The Ruia-controlled Essar Steel Holdings on May 1 disclosed it is acquiring the US-based steel producer Esmark Inc., for an estimated $1 billion.
“The proposed tender offer was unanimously accepted by the board of Esmark Inc., and is subject to customary approvals, including those of the US government and united steel workers,” the group said in a statement.
Esmark is a steel production and distribution company with an annual capacity of 2.4 million tonnes and distribution centres across the US. A definitive pact is to be entered into in 52 days, the group said.
“With the acquisitions of Esmark and projects under implementation in Trinidad and Tobago, Essar Steel Holdings will have a 10 million tonnes of flat steel production in the Americas.”
Within 10 days of entering into definitive documentation with Esmark, a wholly owned subsidiary of Essar will carry forward a two-step acquisition by means of a cash offer for all outstanding shares of Esmark’s stock at $17.00 per share.

Anil twins put up good show

Mumbai: Two Reliance Anil Dhirubhai Ambani Group firms — Reliance Energy and Reliance Natural Resources — have come out with robust numbers.
Reliance Energy has recorded a 31 percent growth in standalone net profit for the fourth quarter ended March 31, 2008, at Rs. 311 crore against Rs. 237 crore in the corresponding period last year.
Income during this period went up 5 percent to Rs. 1,977 crore from Rs. 1,890 crore.
Group Company Reliance Natural Resources Ltd., reported a 44 percent growth in quarterly net profit at Rs. 10.6 crore against Rs. 7.3 crore.
For Reliance Energy, annual net profit on a standalone basis was up 35 percent to Rs. 1,085 crore from Rs. 801 crore in 2006-07.
Total income for the year was up 14 percent to Rs. 7,501 crore from Rs. 6,575 crore.

Buy-buy makes Tata one of the top global brands

London: Tata, one of India’s biggest groups of companies on an acquisition spree has emerged as one of the largest global brands, according to a UK-based independent consultancy firm.
Valued at $11.4 billion, Tata is ranked 57th among top 100 brands listed by brand finance, an independent company focused on the management and valuation of brands.
Coca-cola heads the list followed by fellow American companies Microsoft, Google, Wal-Mart, IBM and GE, while UK’s HSBC is placed seventh. Expressing his happiness, R. Gopalakrishnan, Executive Director of Tata Sons, and member of the group corporate center said it was a first for an Indian brand to be listed among the worlds largest.
“For the first time, an Indian brand has got into the list of the largest global brands, although it is number 57 and they have valued it at $11.4 billion,” he said.
Referring to recent acquisitions, Gopalakrishnan said: “Each of them have a strategic significance for the company.” If you see the three biggest acquisitions in value, the Anglo-Dutch steel company Corus is the biggest. When completed and approved, Ford’s Jaguar and Land Rover will be second and the third will be Tata Chemicals’ purchase of General Chemicals.”
He said the total amount of acquisitions — the highlight of which was the Corus and the Jaguar-Land Rover deal — done by Tata is probably around $25 billion in the last 4 to 5 years and “apart from the apparent glamour, it is hard work.”

20 Indian firms among world’s top 100 in BPO: Report

New Delhi: Reflecting strong industrial growth, 20 Indian firms, including Infosys and TCS are among top 100 outsourcing companies in the world.
The latest “2008 Global Outsourcing 100,” compiled by the International Association of Outsourcing Professionals (IAOP) that features at least 20 Indian firms, has five of them -- Infosys (third rank), TCS (sixth), Wipro (seventh), Genpact (ninth) and Tech Mahindra (tenth) in the top 10.
All the five are leading software service providers. “Half of the top 10 companies are from India, reflecting a strong growth in the outsourcing industry. Infosys Technologies was number three on the leaders list, representing firms with annual sales of $60 million or more,” IAOP said in a statement.

Wages in India to rise by 14.4 pc in 2008: Report

New Delhi: The explosive rate of growth in India has created a phenomenal demand for talent so much that wages are forecast to rise by 14.4 percent during the year 2008, says a latest report.
“Wages are forecast to rise by 14.4 percent during 2008, the fifth successive year of double-digit growth. This far outstrips wage inflation in China (8.6 percent in 2007) and is second only to Sri Lanka, where wage growth has been driven by high inflation,” global management consultancy firm HayGroup said.
The high level of demand for experienced employees is driving wage inflation and creating a culture of job-hopping. Staff turnover of 20 percent or more is not unusual in high-demand sectors such as the service industry, as talented workers jump from employer to employer, following the promise of even higher wages.

India’s trade deficit widens about 34 percent

New Delhi: India’s trade deficit has widened by a whopping 34 percent — to an estimated $80.4 billion for 2007-08 from $59.32 billion in 2006-07, according to official data released on May 1.
The country achieved exports of $155.51 billion against the set target of $160 billion for 2007-08. The export target for the current fiscal is $200 billion.
“We hope to boost our exports more, but at the moment with high oil import prices, we have to live with that,” G. K. Pillai, Secretary of the Ministry of Commerce and Industry, said.
“Textile and other traditional sectors have not done well … We expect these to do well (in 2008-09) because rupee is relatively stable. For the last fiscal, imports were valued at $235.91 billion as against $185.74 billion registering a growth of 27.01 percent over the same period of last year.
Oil imports during 2007-08 stood at $77.03 billion, up 35.28 percent from $56.95 billion in the corresponding period of last year.

India to flag off biggest aircraft deal ever

New Delhi: India is flagging off it’s biggest-ever defense deal for the purchase of 126 fighter aircraft. This has the makings of the fiercest dogfight in the international arms bazaar.
Leading defense contractors are submitting bids to bag the $10-billion deal.
At the receiving end of western arms denial for decades, India is now spoilt for choice.
In the fray are the iconic F-16 and the FA-18 Super Hornet of the US, Russia’s MiG-35, Sweden’s Gripen, France’s Rafaal, and the Euro fighter from a European consortium.
The arms bazaar carnival takes place in the backdrop of a sharply diminishing Indian Air Force.
Against a stated requirement of 44 fighter squadrons, the Indian Air Force has fallen to a vulnerable 30. India is expected to take at least four years to negotiate the deal.

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