BIGFlix to widen screen in tier-II cities

Video-on-demand and online movie rental company BIGFlix is planning to expand its business to almost 15 tier-II cities which include Lucknow , Baroda, Mangalore and Meerut. The company will spend 25% of its investment (around Rs 112.5 crore) in FY09-10 to target smaller towns and cities across India.

The key areas of focus for the Reliance BIG Entertainment company this year will be to strengthen its online service presence in major cities of Gujarat, Maharashtra, Uttar Pradesh, Madhya Pradesh and Delhi. Kamal Gianchandani, COO of BIGFlix.com, said, “We are looking at investing 50-55% of our total investment for the current financial year in building our online business for smaller cities.”

Initially, the company faced some challenges in terms of logistics, system integration and delivering services to customers on time.

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Prime Minister expands his council of ministers, inducts 59

Eleven days after it convincingly emerged victorious at the hustings, the Congress-led UPA finally has a council of ministers in place. Prime Minister Manmohan Singh on Wednesday announced the much-awaited expansion to a full team of 78 members, inducting among others three former chief ministers-Vilasrao Deshmukh, Virbhadra Singh and Farooq Abdullah-and new entrants Mallikarjun Kharge and MK Alagiri at Cabinet rank.

Besides seniority in the party, it is evident that experience and capability played a large part in deciding the 33 Cabinet ministers that make up the Prime Minister’s core team. As expected, the DMK has three Cabinet berths: A Raja, who is likely to get IT & telecom; Dayanidhi Maran, tipped to get textiles; and MK Alagiri, who may get chemicals & fertilisers. NC leader Farooq Abdullah, who was piqued at being left out during the first ministerial announcements last Friday, is being tipped for the tourism portfolio.

Portfolios for the new ministers are scheduled to be announced on Thursday.

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Bharti may pay 5 billion dollars in cash for MTN deal

Bharti Airtel is unlikely to face any problems raising funds to finance its $23-billion swap deal with MTN. Credit rating agency Standard & Poors has affirmed its long-term corporate credit rating at BBB-. On Tuesday, London’s Financial Times newspaper said Bharti might pay up to $5 billion in cash for the deal, citing “unidentified people familiar with the matter”.

S&P said the swap “could result in higher country risk and leverage, but within our tolerance level. The combined entity would also become a leading emerging market telecom operator”. Bharti is expected to use its cash reserves of Rs 11,000 crore (around $2.5 billion) to help bankroll the deal, for which the two companies have entered into exclusive negotiations up to July 31.

In response to a query from FE, Bharti said it wouldn’t need an onerous amount of funding.

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Bharti, MTN renew talks for 23 billion dollars swap deal

The country’s largest telecom operator, Bharti Airtel, has reopened discussions to acquire a 49% stake in South Africa’s MTN for over $23 billion in a cash-cum-stock swap, after a year-long hiatus following the breakdown of talks between the two over the combined entity’s controlling structure. In the latest round, for which the two sides have entered into exclusive negotiations until July 31, MTN and its shareholders would get 36% stake in Bharti.

In a departure from last year’s strategy of direct acquisition and merger of MTN, this time around Bharti is looking at a merger only at a later stage. “The broader strategic objective would be to achieve a full merger of MTN and Bharti as soon as it is practicable, to create a leading emerging market telecom operator,” a Bharti statement said.

If the deal materialises, the combined entity would have 200 million users—with both partners contributing an equal 100 million each—creating the world’s third-largest telecom company in terms of subscriber base after Vodafone Plc and China Mobile.

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Malvinder Singh steps down, Sobti new Ranbaxy CEO

Nearly a year after selling his family’s entire 35% stake in the country’s largest drug manufacturer, Ranbaxy Laboratories Ltd, to Japanese firm Daiichi Sankyo, Malvinder Singh on Sunday stepped down as the company’s chairman, CEO and managing director. Daiichi Sankyo director and Ranbaxy board member, Tsutomu Une, has been appointed as the executive chairman of the company while, Atul Sobti, the current COO has been appointed the new CEO. The changes were announced after the company’s board meeting on Sunday.

With this the Singh family’s association with the company, which his grandfather Bhai Mohan Singh founded in 1961, comes to an end. Singh had joined Ranbaxy in 1998 and became CEO in 2006.

Interestingly, Singh had last year assured that he would continue at the company’s helm of affairs for a minimum of five years.

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DLF close to wind power arm deal

DLF is in the final stages of negotiating a deal to sell off its subsidiary, DLF Wind Power, to French company Eole-Res, which specialises in wind and solar energy. Though the exact value of the transaction is not clear, sources close to the development said the figure is close to Rs 1,000 crore.

India’s largest real estate company by market cap has been in talks with many European and Indian companies for selling the unit, as part of its strategy to hive off non-core businesses to clear its debts.

“Wind Power has met with a good response from strategic partners wherein the due diligence of the assets is currently underway,” DLF had said while declaring its financial results in April.

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Tata Motors issue raises rupees 4,200 crore

Tata Motors has said it raised Rs 4,200 crore ($840 million) through secured non-convertible rupee debentures. The funds will be used to part repay the $3-billion bridge facility taken to acquire Jaguar Land Rover. Tata Motors had earlier prepaid $1.11 billion. The issue opened for bids on Wednesday at 10 am and closed at 5 pm. Tata Motors Ltd acquired the JLR brands from Ford Motor Co for $2.3 billion last year.

The debenture issue is among the largest by an Indian company, Tata Motors said. The debentures—issued in four tranches with maturities ranging from 23 to 83 months—carry a coupon of 2% and will be redeemed at varying premia on maturity. All the tranches are guaranteed by State Bank of India.

Tata Motors CFO C Ramakrishnan said, “The issue was quite a success and well oversubscribed.

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Cannot afford to miss the bus: Prime Minister

With the Congress parliamentary party officially electing Manmohan Singh as its leader on Tuesday, the PM-designate—he is expected to be sworn in on Friday—said on the occasion that his new administration’s first priority is to re-energise government and make it more responsive and efficient.

Citing the challenges still ahead for the global economy, Singh said there is need to counter the slowdown in investment and employment generation to revive growth, while making it more inclusive. “We cannot afford to miss the bus now. We cannot afford to lag behind the rising economies of the East,” Singh said.

Mooting better financial management and economic reform, Singh said there is need to create a social and political environment that attracts new investment, without which growth cannot be sustained or made more inclusive.

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Ministries speed up to keep new government in top gear

After a two-month lull forced by the Lok Sabha polls, Monday saw the government machinery swing back into action to prepare the ground for the new government, likely to be sworn in on Saturday. Now that Prime Minister Manmohan Singh and his council of ministers have resigned, and President Pratibha Patil dissolved the 14 th Lok Sabha, officials worked overtime to prepare priority action plans for their new ministers.

Monday was also a hectic day for Congress leaders,who strained every nerve to sketch the new Cabinet, ahead of a meeting with their alliance partners on Wednesday.

“The Prime Minister has asked all ministries to come up with measures that need to be considered and implemented on a priority basis in the first three months of the new government.

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Economic crisis to form Cabinet backdrop

The race for Cabinet berths in the new government started off on Sunday, as Prime Minister Manmohan Singh made it clear that deft management of the economic crisis topped his concern.

Speaking at the first meeting of the Congress Working Committee after the elections, Singh said the new government will assume responsibility in the backdrop of the deep global economic recession. Party circles interpreted this as a signal that the Prime Minister is keen to get “technocrat” Montek Singh Ahluwalia as the finance minister. Ahluwalia, deputy chairman of the Planning Commission, had been a candidate for finance minister even earlier, as he has drafted the three economic stimulus packages the government rolled out after the global crisis began.

Speaking to Indian Express, Ahluwalia said the media reports were all speculation. Incidentally, the finance ministry, in expectation of the presentation of a quick Budget, has slotted several pre-Budget meetings this week, including one with the CII on Monday.

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Tea prices to go up by Rs 40 per kg on shortages

Tea will become costlier by Rs 15-20 a kg for the retail consumer from this week. Leading tea companies and retailers have decided to raise the retail prices of tea in two phases, by Rs 15-20 from May 15, to be rounded off with a similar hike in June. This means, tea will be costlier by Rs 30-40 a kg, depending quality, in a space of roughly 40 days.

Such a steep hike in tea prices is attributed to a domestic short supply from poor rains in tea growing areas, coming on the back of a global shortage triggered by crop failures in Kenya and Sri Lanka.

"Prices of green tea leaves have gone up sharply. At the auction centres, prices have already increased by 30% during the current year but local traders have not increased their local prices.

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European Union slaps Intel with a record 1.45 dollar billion antitrust fine

The European Union fined Intel Corp a record euro1.06 billion ($1.45 billion) on Wednesday, saying the world’s biggest chipmaker used illegal sales tactics to shut out smaller rival AMD. The fine exceeded a euro 899 million monopoly-abuse penalty for Microsoft Corp last year.

Intel called the decision “wrong” and said it would appeal. Intel, based in Santa Clara, California, has about 80% of the world’s personal computer microprocessor market—and faces just one real rival, Advanced Micro Devices Inc (AMD), which is headquartered in Sunnyvale, California.

The European Commission says Intel paid computer makers Acer, Dell, HP, Lenovo and NEC to postpone or scrap plans to launch products using AMD chips,

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Aquarter of Indians to live on 1.25 dollars per day in 2015: World Bank

India now is ahead of only Sub-Saharan Africa among developing countries in terms of the percentage of population below the poverty line, though it fared better than China on this count in 1990, according to the World Bank.

The multilateral lender, in its recently released report ‘Global Economic Prospects for 2009’, said a quarter of India’s population will be living in extreme poverty, on less than $1.25 a day, in 2015.

The corresponding figures for China is 6.1% and for Sub-Saharan Africa 37.1%. These are based on purchasing power parity exchange rates derived from the 2005 price surveys, meaning that the calculations have been made assuming a dollar’s purchasing power to be the same in the years under consideration as in 2005.

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Slumdog inspires more British films with Bollywood stars

The runaway success of Danny Boyle’s Slumdog Millionaire, which swept the Oscars this year, has inspired several British film makers to go in for movies with Bollywood stars to attract the global audience.

Many studios are now looking to replicate its success. One of the new films in production include Indian Summer, which is being filmed on location in the subcontinent. It tells the story of the last days of colonial rule and is directed by Joe Wright, who had a period-drama hit with Ian McEwan’s Atonment.

“India is a fascinating, extraordinary place,” Wright told Variety magazine.“What’s happening there is going to affect us more and more, whether in film industry terms or politically with what’s happening in Pakistan.”

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Knight Riders most valued Indian Premier League team at $42.1 million

Shah Rukh Khan’s Kolkata Knight Riders may be struggling at the bottom in the second season of Indian Premier League, but in terms of brand value it is the richest team of the T20 cricket tournament, whose collective valuation has been now pegged at $2 billion.

At the same time, Rajasthan Royals, partly owned by another Bollywood star Shilpa Shetty, has emerged as the best team in terms of return on investment, although it is ranked third in terms of brand value. The valuation exercise of the entire IPL franchise, along with the individual teams, has been conducted by UK-based international brand valuation consultancy Brand Finance Plc.

“The entire enterprise is valued at $2.01 billion,” Brand Finance said, adding, its methodology took into account various revenue lines such as broadcasting, IPL sponsorship, team sponsorship, merchandising and gate receipts as well as the effect of performance, the catchment population of the city, the capacity of the stadium and the presence of iconic players.

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Hyundai Motor’s 900 workers at Chennai call off agitation

The 900-odd agitating workers of Hyundai employees union called off their strike on Thursday with the management agreeing to look into their list of 45 demands. Company spokesman Rajiv Mitras aid Hyundai has agreed to reinstate 20 workers who were suspended last year.

During the tripartite talks between union representatives, labour commissioner and management representatives it was also decided that workers demands would be looked in toon May 18, after the conclusion of Lok Sabha polls in Tamil Nadu. Commenting on the decision to call off the strike,workers’ representative, Edision Periera claimed,“Management has assured us of not taking punitive action against those involved in the strike and we will continue negotiations with them on our demands post elections”. In the mean time picketing workers will return to work by tomorrow.

But the company has not agreed to the demand to recognise the formation of any trade union by the workers.

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Day after Rahul woos rivals, Sonia givesTamil Nadu a miss

With AICC general secretary Rahul Gandhi’s attempts to reach out to rivals, especially Nitish Kumar of JD(U) and Chandra babu Naidu of the TDP,upsetting UPA partners, the Congress today worked overtime to placate allies, saying it was “totally” with them and “confident of forming a secular government”.

But the decision to scrap Sonia Gandhi’s poll rallies in Tamil Nadu, where partner DMK is spearheading the alliance campaign, fuel led suspicion among allies, the move coming a day after Rahul Gandhi suggested that AIADMK’s J Jayalalithaa, DMK’s arch rival, could be a possible post-poll partner.

“We are totally with our allies and we are confident of forming a secular government under the leadership of Manmohan Singh.In case there is need to reach out to other secular allies after the results are out on May 16, then it will be considered.

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Obama tax move may hit Double Tax Avoidance Agreement

The decision by President Barack Obama to plug loopholes in the tax regime for US multinational companies is likely to impact their Indian operations as well. Indian subsidiaries of US firms may no longer be able to claim benefits under the Indo-US double-tax avoidance agreement (DTAA).

Current US laws allow businesses to claim credit against their US tax bill on taxes paid abroad on overseas profits. Obama is planning to close such foreign tax credits, and hopes to net $43 billion. “Article 25 of the Indo-US DTAA provides relief from double taxation, subject to US domestic laws. This may now be open for a reinterpretation,” pointed out KPMG head of taxation Uday Ved.

Obama’s Monday announcement comes close on the heels of moves by the current administration in Washington to further restrict H-1B visas,

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Sensex tops 12k mark as global markets rally

The rally in emerging markets, especially Russia and China, last week was reflected in Indian markets on Monday, which reopened after a four-day recess. Equity markets jumped to their highest level since October 2008.

The 30-share Sensex of the Bombay Stock Exchange (BSE) topped the psychological 12,000-level to end the trading session at 12,134.75 points, gaining 731.50 points or 6.41%. The Sensex was the highest gainer among all Asian markets. Similarly, the broader S&P CNX Nifty of the National Stock Exchange (NSE) surged by 180.05 points, or 5.18%, to close the day at 3,654 points.

The rally was part of the extended gains witnessed in Asian markets, which moved up in response to data released by China revealing its industrial output had expanded for the first time in nine months.

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New mobile services in Jammu and Kashmir ring security alarm bell

The Intelligence Bureau (IB) has taken a strong objection to the practice of mobile operators starting operations in new circles and offering new technology services without adequate lawful monitoring arrangements.

In a strongly worded letter to the department of telecommunications (DoT), IB has written that “this practice needs immediate correction”.

What caused the IB’s ire is the launch of GSM services by Reliance Communications Ltd (RComm) and CDMA services by Tata Teleservices Ltd in Jammu & Kashmir a couple of months ago, allegedly done without the required security clearance.

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