APOLLO TYRES TO ACQUIRE COOPER TIRE & RUBBER COMPANY

About Apollo Tyres Ltd Apollo Tyres Ltd is a high-performance tire manufacturer headquartered in India. It is built around the core principles of creating stakeholder value through reliability in its products and dependability in its relationships. The company has manufacturing units in India, the Netherlands, and South Africa and exports its products around the world. In each of its markets the company operates through a vast network of branded, exclusive and multiproduct outlets. About Cooper Tire & Rubber Company Cooper Tire & Rubber Company (NYSE: CTB) is the parent company of a global family of companies that specialize in the design, manufacture, marketing, and sales of passenger car and light truck tires. Cooper has joint ventures, affiliates and subsidiaries that also specialize in medium truck, motorcycle and racing tires. Cooper's headquarters is in Findlay, Ohio, with manufacturing, sales, distribution, technical and design facilities within its family of companies located in 11 countries around the world. For more information on Cooper Tire Combination Creates Worlds Seventh-Largest Tire Company with $6.6 Billion in Revenue GURGAON, India and FINDLAY, Ohio, USA June 12, 2013 Apollo Tyres Ltd (NSE: ApolloTYRE) and Cooper Tire & Rubber Company (NYSE: CTB) today announced the execution of a definitive merger agreement under which a wholly-owned subsidiary of Apollo will acquire Cooper in an all-cash transaction valued at approximately $2.5 billion approximately at Rs 14,500 crore. Under the terms of the agreement, which has been unanimously approved by the boards of directors of both companies, Cooper stockholders will receive $35.00 per share in cash. The transaction represents a 40% premium to Coopers 30-day volume-weighted average price. This strategic combination will bring together two companies with highly complementary brands, geographic presence, and technological expertise to create a global leader in tire manufacturing and distribution. Apollo, founded in 1972, has an international reputation for high performance tires across a portfolio of well-known premium and mid-tier brands, including the flagship Apollo brand and Vredestein. Cooper, the 11th-largest tire company in the world by revenue, was founded in 1914 and today supplies premium and mid-tier tires worldwide through renowned brands such as Cooper, Mastercraft, Starfire, Chengshan, Roadmaster and Avon. The combined company will be the seventh-largest tire company in the world and will have a strong presence in high-growth end-markets across four continents. With a combined $6.6 billion in total sales in 2012, the combined company will have a full range of brands and greater ability to satisfy customer needs worldwide. The combination is expected to deliver value creation benefits of approximately $80-120 million per annum at the EBITDA level. These ongoing benefits are expected to be fully achieved after three years and derived from operating scale, sourcing benefits, technology,

product optimization, and manufacturing improvements. The transaction is expected to be immediately accretive to Apollos earnings. This transformational transaction provides an unprecedented opportunity to serve customers across a host of geographies in both developed and fast-growing emerging markets around the world. Cooper is one of the most respected names in the tire industry, with an extensive distribution network and manufacturing infrastructure, and a particularly robust presence in North America and China. The combined company will be uniquely positioned to address large, established markets, such as the United States and the European Union, as well as the fast-growing markets of India, China, Africa, and Latin America where there is significant potential for further growth. Our combined portfolio of brands and products will be amongst the most comprehensive in the industry India's Apollo Tyres Ltd. (500877.BY) Tuesday denied allegations that it is avoiding coming to a new employment agreement with a U.S. labor union to get out of its $2.5 billion deal to acquire the Cooper Tire & Rubber Co. (CTB). In a response to a suit filed in a Delaware court by Cooper, Apollo denied Cooper's allegations that it was delaying negotiations with the United Steel Workers union for a new collective bargaining agreement at two of Cooper's U.S plants. It further denied allegations that it was aware that Cooper's joint venture partner in China, Chengshan Group (600828.SH), would object to the sale of Cooper to Apollo. In China, workers went on strike to protest the proposed sale. In September, a U.S. court ruled that Cooper could not sell two U.S. plants without the American workers first obtaining a new employment agreement with Apollo. Apollo also denied that its decision to seek a reduction in its offer of $35 a share was motivated by a negative reaction from investors to the acquisition of Cooper. The Indian company's share price fell 39% to 56.5 rupees in the 15 days following the deal's announcement.

PepsiCo looks to bid for Balaji Wafers

Blackstone, Actis also considering PE investments in potato chips maker MUMBAI, AUG. 27:
PepsiCo Inc, the world's largest snack-food maker, is exploring a bid for smaller local rival Balaji Wafers Pvt Ltd as the MNC looks for a larger market share in developing countries. Sources familiar with the matter said the US foods giant is expected to buy up to 25 per cent stake in the Indian company. Although PepsiCo and rival Coca-Cola Co are vying for a bigger chunk of developing countries' business, PepsiCo hasn't submitted an offer and a deal is still in the works.

Snack-maker Balaji Wafers is considering a stake sale of about 15-25 per cent to PepsiCo, the worlds largest beverages company.

The deal is expected to value the company at four to six times its current turnover of about Rs 1,000 crore. Balaji Wafers, a Rajkot-based maker of potato chips and other savouries, is also in talks with strategic investors and private equity firms including Blackstone Group and Actis to raise funding. They had approached us a few months back, and since then we have been in talks. We intend to close the deal in the next two-three months, but there is no surety that the deal will go through, a top official at Balaji Wafers said on condition of anonymity. In 1994, PepsiCo had bought out its joint venture partner Lehar Foods to take on local players such as Balaji, A-Top Foods and Bikanerwala. However, PepsiCo continues to face stiff competition in the domestic snack market, with the emergence of players such as Parle, DFM Foods (owner of Crax), Haldirams and, more recently, FMCG major ITC (Bingo). The US firm, which owns brands such as Kurkure and Lays, has been losing its market share in the more than Rs 10,000 crore Indian savoury market. The Balaji Wafers official said Pepsi and other investors had earlier approached the company last year, seeking stakes of 40-100 per cent. We were not looking for a complete exit, he said, adding the company had hired advisory firm Ernst & Young to find a suitable investor. Balaji Wafers, set up in 1982, supplies food products across Gujarat, Maharashtra, Madhya Pradesh and Rajasthan.

RenaultNissan Alliance
From Wikipedia, the free encyclopedia

RenaultNissan Alliance

Type Industry Founded Headquarters Key people Products Subsidiaries Website

Strategic partnership Automotive 1999 Amsterdam, Netherlands Carlos Ghosn (Chairman and CEO) Cars and trucks Daimler AG(3.1%) RenaultNissan Alliance

RenaultNissan Alliance is a strategic Franco-Japanese partnership between automobile manufacturers Renault, based in Paris, France, andNissan, based in Yokohama, Japan, which together sell more than one in 10 cars worldwide.[1] The companies, which have been strategic partners since 1999, have nearly 350,000 employees and control seven major brands: Renault, Nissan, Infiniti, Renault Samsung Motors, Dacia, Datsun andLada.[2] The car group sold 8.1 million cars worldwide in 2012, behind Toyota, General Motors and Volkswagen for total volume.[3] As of July 2013, the Alliance is the world's leading plug-in electric vehicle manufacturer, with global sales of 100,000 units delivered since December 2010.[4]

The strategic partnership between Renault and Nissan is not a merger or an acquisition. The two companies are joined together through a cross-shareholding agreement. The structure was unique in the auto industry during the 1990s consolidation trend and later served as a model for General Motors and PSA Peugeot Citron,[5] PSA Peugeot Citron and Mitsubishi, and Volkswagen and Suzuki, [6] though the

latter combination failed.[7] The Alliance itself has broadened its scope substantially, forming additional partnerships with automakers including Germany's Daimler, China's Dongfeng Motor, and Russia's AvtoVAZ.[8] The Nissan-Renault strategic alliance is one which has survived the test of time after being formed in March 1999. Renault had previously been unsuccessful in pursing an alliance with Volvo. However, the company was undaunted by this failure and saw the opportunity to work with Nissan as potentially providing numerous benefits, including a significant presence in the all-important Asian markets. Nissan, however, was fighting for survival under a mountain of debt it had assumed. It had previously approached Chrysler but the number-three U.S. carmaker declined the overture. Given Nissans financial pressures, one of the most fundamental contributions of Renault was capital. It gave Nissan Motors $4.86 billion and $76.6 million to Nissan Diesel. In exchange, Renault received a 36.8% equity stake in Nissan Motors and a 22.5% stake of Nissan Diesel.a The agreement also allowed Renault to acquire additional equity in Nissan at a later date. In addition, the leadership of Carlos Ghosn, formerly of Renault and who became Chief Operating Officer of the troubled Nissan, cannot be understated. Ghosn is one of the worlds leading automobile executives, and his leadership was essential to the enjoyed success of Nissana company that the world had doubts would survive. Nissans managerial errors had caused it to assume a nonviable debt capital structure and it needed to totally change the way it managed the company. Under Ghosn they were able to do this and grow.

UltraTech buys Jaypees Guj Cement for Rs 3,800 cr

Aditya Birla Group firm UltraTech Cement today confirmed that it will acquire Gujarat Cement unit of Jaypee Cement Corp for Rs 3,800 crore. UltraTech Cement will acquire the Gujarat Cement Unit of Jaypee Cement Corp Gujarat Cement Unit comprises of an integrated cement unit at Sewagram and grinding unit at Wankbori, the company said in a statement. The combined capacity of both the divisions is 4.8 million tonnes along with 57.5 MW coalbased thermal power plant, limestone reserves of over 90 years at current capacity and a captive jetty at Sewagram. With this acquisition of 4.8 million tonnes per annum, the companys current capacity increases to 59 million tonnes per annum. With projects underway it will stand raised to 70 million tonnes by 2015, UltraTech Cement Chairman Kumar Mangalam Birla said. Putting an enterprise value of Rs 3,800 crore on Gujarat Cement Unit, UltraTech said it will issue equity to the shareholders of Jaypee Cement. The proposed transaction is subject to approval of shareholders and creditors, sanction of the Scheme of Arrangement by the High Courts, approval of the Competition Commission of India besides other statutory approvals. Talking about the companys debt, Executive Chairman of Jaypee group Manoj Gaur said monetization of Gujarat cement plant is the first step towards debt reduction, which will go

down by 15 percent post the deal with Ultratech. He said it can be reduced by another Rs 15000 crore by monetising cement, thermal and hydro assets. Jaypees has a total debt of 23000 crore barring power projects. Its gross debt of all businesses stands at Rs 55000-56000 crore.

The Leveraged Buy Out Deal of Tata & Tetley

The Lectic Law library's Lexicon defines a leverage buyout as "a mechanism under which a company is acquired by a person or entity using the value of the company's assets to finance its acquisition. This allows (for) the acquirer to minimise its outlay of cash in making a purchase." Tetley was the second largest brand of packaged tea in the global market, behind Unilever's Brooke Bond and Lipton brands.

In a landmark deal, heralding a new chapter in the Indian corporate history, Tata Tea acquired the UK heavyweight brand Tetley for a staggering 271 million pounds. This deal which happened to be the largest cross-border acquisition by any Indian company, marked the culmination of Tata Tea's strategy of pushing for aggressive growth and worldwide expansion. The acquisition of Tetley pitchforked Tata Tea into a position where it could rub shoulders with global behemoths like Unilever and Lawrie. The acquisition of Tetley made Tata Tea the second biggest tea company in the world. (The first being Unilever, owner of BrookeBond and Lipton). Moreover it also went through a metamorphosis from a plantation company to an international consumer products company. Ratan Tata, Chairman, Tata group said, "It is a great signal for global industry by Indian Industry. It is a momentous occasion as an Indian company has been able to acquire a brand and an overseas company." Apart from the size of the deal, what made it particularly special was the fact that it was the first ever leveraged buyout (LBO) by any Indian company. This method of financing had never been successfully attempted before by any Indian company. Tetley's price tag of 271 mn pounds (US $450 m) was more than four times the net worth of Tata tea which stood at US $ 114 m. This David & Goliath aspect was what made the entire transaction so unusual. What made it possible was the financing mechanism of LBO. This mechanism allowed the acquirer (Tata Tea) to minimise its cash outlay in making the purchase.
2 1

De-Mystifying LBO
The Tata-Tetley deal was rather unusual, in that it had no precedence in India. Traditionally, Indian market had preferred cash deals, be it the Rs.10.08 billion takeover of Indal by Hindalco or the Rs. 4.99 billion acquisition of Indiaworld by Satyam. What set the deal apart was the LBO mechanism which financed the acquisition. (See Box item to know about the basics of LBOs). The LBO seemed to have inherent advantages over cash transactions. In an LBO, the acquiring company could float a Special Purpose vehicle (SPV) which was a 100% subsidiary of the acquirer with a minimum equity capital. The SPV leveraged this equity to gear up significantly higher debt to buyout the target company. This debt was paid off by the SPV through the target company's own cash flows. The target company's assets were pledged with the lending institution and once the debt was redeemed, the acquiring company had the option to merge with the SPV...

Structure of the Deal

The purchase of Tetley was funded by a combination of equity, subscribed by Tata tea, junior loan stock subscribed by institutional investors (including the vendor institutions Mezzanine Finance, arranged by Intermediate Capital Group Plc.) and senior debt facilities arranged and underwritten by Rabobank International.

Tata Tea created a Special Purpose Vehicle (SPV)-christened Tata Tea (Great Britain) to acquire all the properties of Tetley. The SPV was capitalised at 70 mn pounds, of which Tata tea contributed 60 mn pounds; this included 45 mn pounds raised through a GDR issue. The US subsidiary of the company, Tata Tea Inc. had contributed the balance 10 mn pounds. The SPV leveraged the 70 mn pounds equity 3.36 times to raise a debt of 235 mn pounds, to finance the deal (Refer FIGURE I). The entire debt amount of 235 mn pounds comprised 4 tranches (A, B, C and D) whose tenure varied from 7 years to 9.5 years, with a coupon rate of around 11% which was 424 basis points above LIBOR...

Reliance Industries demerger

Reliance Industries is one of the largest private sector company in India. From rags to riches, its founder Dhirubhai Ambani built it single-handedly with a vision to own the entire chain of production-from raw materials to finished goods. The Group's current activities span Exploration and Production (E&P) of oil and gas, refining and marketing, petrochemicals, textiles, financial services and insurance, power and telecom initiatives. The Group exports its products to more than 100 countries all over the world. After the death of the great business icon, Dhirubhai Ambani in July 2002, differences began to crop up between the two brothers, Anil and Mukesh. Anil Ambani accused Mukesh Ambani and his aides for lack of corporate governance, unfair transfer of funds from RIL to Reliance Infocomm, illegal re-routing of international calls and quietly appropriating all powers in RIL. Mukesh Ambani, with the help of his aides, denied all allegations and sidelined his brother. Feuds continued publicly till November 2004, when Mukesh Ambani declared ownership issues and the battle took a new turn with both the brothers deciding to split the empire. The finale came on June 19, 2005, when an amicable settlement was reached with the help of their mother Kokilaben Ambani, wife of Dhirubhai Ambani. According to the settlement, Mukesh Ambani will retain the ownership of RIL and IPCL, which together account for 90% of the Group's revenues; while Anil Ambani has to manage Reliance Infocomm, Reliance Capital and Reliance Energy. It's a wait for the future to see which Ambani surpasses the other. This case traces the history of one of the biggest companies India has ever had and the origin of the feud after the death of Dhirubhai Ambani. This case also ends with an overview of what may be the impact of the division of Reliance Industries on the Indian industrial sector. "Our dreams have to be bigger. Our ambitions higher. Our commitment deeper. And our efforts greater. This is my dream for Reliance and for IndiaThe organizational architecture is really that a centipede walks on hundred legs and one or two don't count. So if I lose one or two legs, the process will go on, the organization will go on, the growth will go on.For us-for me especiallythis is a new beginning," he said. "This is a car without a reverse gear; we are only going forward. June 19, 2005: The early dawn brought with it rays of hope, peace and tranquility. There came a new agreement, a new power structure ending India's messiest and shortest family feud in a truly dramatic style. Life will never be the same again for India's largest private sector business family, the Reliance group of industries. The two warring brothers, Mukesh Ambani (Mukesh) and Anil Ambani (Anil), settled the ownership issues when a final agreement was signed after 4 AM on June 19, 2005 at Seawind, the famous residence of the Ambani family. The settlement was reached with the help of a high powered team of negotiations and their great mother Kokilaben D Ambani, who was assisted by the CEO of ICICI, K V Kamath and J M Morgan Stanley's Chairman Nimesh Kampani. According to the settlement, Mukesh will have responsibility for REL Industries and IPCL while Anil will have responsibility for Reliance Infocomm (RIC), Reliance Energy (REL) and Reliance Capital. Anil then triumphantly announced the creation of a new mega business group, The Anil Dhriubhai Ambani Enterprise (ADAE). Mukesh gets charge of companies which account for 95% revenues of the empire while Anil will have to manage the fast growing but cash guzzling businesses.

Bajaj Auto unveils demerger plan Jun 26, 2007 at 08:15pm IST

Mumbai: Ending months of speculation over a possible split of the Bajaj Auto empire, the company's board on Thursday approved a scheme to demerge its non-auto business from the flagship company and create a holding company for the two. Announcing the plans, Bajaj Auto Chairman Rahul Bajaj said the move to demerge the company was to unlock shareholder value and not to divide the group between his two sons Rajiv and Sanjiv. "It is all nonsense (family feud)... the work is divided and the ownership between four brothers and two sons remains the same," he said. As per the proposal, Bajaj Group's auto business will be demerged into a new subsidiary Bajaj Holdings and Investment Ltd (BHIL) and other strategic businesses such as wind energy, insurance and financial services would be demerged into another new entity Bajaj Finserv Ltd (BFL). Bajaj Auto shareholders would continue to hold one share of the company with face value of Rs 10 and would also be allotted one BHIL share of Rs 10 face value and one BFL share of Rs 5 face value. The demerger would be completed this year. Rebuffing suggestions that the move was to spilt the group, he said: "I will be the chairman of all the three companies. It is not a split of Bajaj Auto. Out of Rs 8,500 crore cash and cash equivalents, Rs 1,500 cr will go to the new Bajaj Auto and Rs 800 crore will be transferred to BFL. The balance Rs 6,000 crore will remain with the BHIL," Bajaj said. The transaction will enable the new companies to tap into the cash pool of BHIL to support future growth, while enabling BHIL to participate in the growth of the auto business and the financial services business. Ruling out any change in management structure of the group, Rahul Bajaj said: "There is generally no change in the management structure." Rajiv Bajaj would continue as Managing Director and CEO while his brother Sanjiv would continue as Executive Director of the manufacturing entity. In addition, Sanjiv would also be responsible for Bajaj Finserve. The board structure of the existing entity Bajaj Auto would also be unaltered, while the boards of BHIL and BFL would have Rajiv, Sanjiv and their uncle Madhur Bajaj as directors to start with, along with Rahul Bajaj as chairman. As part of the restructuring process, BHIL would be renamed "Bajaj Auto Ltd" and the existing Bajaj Auto Ltd would be renamed as "Bajaj Holdings and Investment Ltd". Bajaj said the new companies would be listed on the bourses by December after getting all necessary clearances. The holding

company will hold a 30 per cent stake in each of these subsidiaries while existing shareholders of BAL will have 70 per cent stake in the ratio of their current holding. The news of demerger was, however, not perceived well in the bourses with the company's scrips tumbling by over 10 per cent in intraday trade as details of the plans emerged. It closed the day at Rs 2500.30, down Rs 179.15 or 6.71 per cent at the BSE. Read more at: http://ibnlive.in.com/news/bajaj-auto-unveils-demergerplan/40817-7.html?utm_source=ref_article