MUMBAI: Markets in India were trading higher Thursday, as traders bought stocks at lower levels after the previous day’s steep fall and eyeing positive trend in Asian peers.
Leading the rebound were IT, auto, consumer durables while realty , power , capital goods and FMCG continued to languish.
At 9:26 am, Nifty was at 5871.40, up 5.65 points or 0.10 per cent. The National Stock Exchange benchmark opened the day at 5883.95 against Wednesday’s close of 5865.75. The 50-share index saw a high of 5900.15 versus a low of 5870.55.
Sensex traded at 19,534.67, gaining 74.82 points or 0.38 per cent. The Bombay Stock Exchange sensitive index opened at 19,560.25 versus the previous close of 19,459.85. The 30-share index moved between 19,600.88 and 19,528.52 in the early minutes.
“Today, we expect the Indian markets to open flat and make an attempt to rise in the early part of the session. Later it could take cues from the European markets. Among the sectoral indices, Auto stocks could do well while IT, Metals and Oil & Gas could underperform,” said HDFC Securities in its morning note.
EGoM to consider 5 more states for gas allocation
Five more power plants will now be considered for gas allocation by the Empowered Group of Ministers (EGoM). These five companies have been added to the list though a supplementary agenda moved by the petroleum ministry, reports CNBC-TV18’s Mehak Kasbekar.
Here is a verbatim transcript of her comments. Also watch the accompanying video.
Mehak Kasbekar, CNBC-TV18
Excerpts from India Business Hour on CNBC-TV18 Watch the full show »
Its an extremely interesting twist as far as gas allocation is concerned. We are now looking at Petroleum Ministry really batting for public sector units, already there was an agenda note which was cleared by the petroleum ministry but the EGoM unfortunately didn’t take place.
Now the EGoM will take place in the first week of December and there will be five new plants that will be added taking the total to about 14 plants. Five chief ministers of different states have written to the petroleum ministry directly saying that they were not on that proposed list of nine by the power ministry and since these power plants are important for state governments and state utilities they have the right to be on that agenda.
Petroleum ministry seems to be convinced about this and infact what it mentions is primarily the letter written by Andhra Pradesh Chief Minister seeking about 9.72 mmscmd for the APGENCO power plant of about 2700 megawatts each. Its not really clear, how much will this add to the entire capacity, but approximately this will be about 20 to 25 mmscmd for PSUs.
Here is a verbatim transcript of her comments. Also watch the accompanying video.
Mehak Kasbekar, CNBC-TV18
Excerpts from India Business Hour on CNBC-TV18 Watch the full show »
Its an extremely interesting twist as far as gas allocation is concerned. We are now looking at Petroleum Ministry really batting for public sector units, already there was an agenda note which was cleared by the petroleum ministry but the EGoM unfortunately didn’t take place.
Now the EGoM will take place in the first week of December and there will be five new plants that will be added taking the total to about 14 plants. Five chief ministers of different states have written to the petroleum ministry directly saying that they were not on that proposed list of nine by the power ministry and since these power plants are important for state governments and state utilities they have the right to be on that agenda.
Petroleum ministry seems to be convinced about this and infact what it mentions is primarily the letter written by Andhra Pradesh Chief Minister seeking about 9.72 mmscmd for the APGENCO power plant of about 2700 megawatts each. Its not really clear, how much will this add to the entire capacity, but approximately this will be about 20 to 25 mmscmd for PSUs.
Health Min calls for tighter pharma FDI norms
Health Minister, Ghulam Nabi Azad has called for tighter pharmaceutical FDI norms, reports CNBC-TV18's Rituparna Bhuyan quoting sources.
The health minster has written to the Commerce Minister seeking tighter pharmaceuticals foreign direct investments (FDI) norms. In the letter he said, that he was concerned over the takeover of Indian pharmaceutical companies by multi national companies (MNC) and sought for the Pharmaceutical FDI norms to be revisited immediately from auto to the FIPB route. These measure, he impressed, were essential in order to make affordable medicines accessible.
Health Min calls for tighter pharma FDI norms
There have been six pharmaceutical takeovers between August 2006 and May 2010 valued at around USD 10.45 billion.
The minister has also said that there is no need for rigid Compulsory Licensing (CL) norms. The CL allows non-patent holders to produce and market drugs. The DIPP paper however, has sought views on Compulsory Licensing.
The Minister is of the view that the CL should be issued in case of anti-competitive practices and that there should be no bar in private channels distributing CL products on actual cost basis.
The health minster has written to the Commerce Minister seeking tighter pharmaceuticals foreign direct investments (FDI) norms. In the letter he said, that he was concerned over the takeover of Indian pharmaceutical companies by multi national companies (MNC) and sought for the Pharmaceutical FDI norms to be revisited immediately from auto to the FIPB route. These measure, he impressed, were essential in order to make affordable medicines accessible.
Health Min calls for tighter pharma FDI norms
There have been six pharmaceutical takeovers between August 2006 and May 2010 valued at around USD 10.45 billion.
The minister has also said that there is no need for rigid Compulsory Licensing (CL) norms. The CL allows non-patent holders to produce and market drugs. The DIPP paper however, has sought views on Compulsory Licensing.
The Minister is of the view that the CL should be issued in case of anti-competitive practices and that there should be no bar in private channels distributing CL products on actual cost basis.
Stocks in news: Money Matters, BHEL, DB Realty, BGR Energy
Here are stocks that are in news today:
Claris Lifesciences IPO subscription as of now (Last Day today): as per NSE
-Total: 0.09 times (x)
-QIB: 0.00x
-NII: 0.01x
-Retail: 0.26x
Bank Bribery Scam
Stocks in news: Money Matters, BHEL, DB Realty, BGR Energy
CBI sources say
-5 companies involved in scam took loan of Rs 1,000 crore
-Companies took loan to invest in stocks, manipulate share prices
-One company took loan of Rs 560 crore, another Rs 300 crore, rest Rs 50-60 crore
-Likely to write to SEBI on share price manipulation
RBI gets into action - sources say
-RBI gets into action; seeks details of all secured loans
-RBI to look into consortium loans okayed by managing comms
-RBI Seeks details from banks on 15 accounts
-All consortium loans run into thousands of crores
Companies under RBI scanner
-BGR Energy, OPG Power, Ashapura Mines, Lavasa
-DB Realty, Entertainment World Lucknow, Mantri Realty
-PK Tayal-Promoted Krishna Group, Suzlon, Pantaloon
-Indore City Treasures, Adani Group, JP Hydro, JSW Energy, Emaar MGF
Cairn - Sources
-Cairn gives into GoI demand; to ask for nod for pre-NELP blocks
-Cairn may request for Govt approval before weekend
Alert: Cairn earlier sought GoI approval for only NELP blocks
-Cairn's letter may not mention ONGC's pre-emptive rights issue
Alert: ONGC has claimed pre-emptive rights
-Cairn India declines to comment
Alert: Cairn has 3 pre-NELP blocks
Kingfisher Airlines okays debt restructuring
-Okays converting Rs 1,360 crore debt from lenders to shares
-To convert Rs 650 crore debt from promoters into shares
-To repay balance debt in 9 years with 2-year moratorium
-Interest rate on balance of debt reduced
-To issue 57.5 crore preference shares to lenders
-Preference shares to lenders redeemable at par in 12 years
DB Realty says
-Received notice from CBI to share loan sanction documents
-Went with documents today but CBI has asked to come back on Friday
-CBI only seeking info on loans sanctioned by Money Matters
-Our executives did go see RR Nair on loan sanction
-There was only 1 meeting with RR Nair in November 2009
-RR Nair wanted certain info on our projects
-No bank will give a loan to a client without a meeting
-No crossholding with DB Realty & Telco Etisalat DB
-CBI has not asked for info regarding link with Etisalat
BHEL
-Board approved setting up of a new BHEL plant as "Power Equipment Fabrication Plant" at Maharashtra.
-Forwarding proposal for initiating the process of merger of Bharat Heavy Plate & Vessels Ltd. (a wholly owned subsidiary) with BHEL
Other stocks and sectors that are in news today:
-Money Matters board to meet on Friday on further action in bribery case: NW18
-Maruti to hire 3000 employees for expanded service network – BS
-Tata Steel eyes more acquisitions – Agencies
-Nahar Poly (Nahar Investments) revises open offer price from Rs 40 to Rs 50
-TEBMA Shipyard open offer at Rs 19.20/sh (Bharti Shipyard acquired majority stake)
-Glodyne Tech: stock split: face value of 10 to become face value 6, approved fund raising
-Pratibha Industries: approves allotment of 50 crore
Claris Lifesciences IPO subscription as of now (Last Day today): as per NSE
-Total: 0.09 times (x)
-QIB: 0.00x
-NII: 0.01x
-Retail: 0.26x
Bank Bribery Scam
Stocks in news: Money Matters, BHEL, DB Realty, BGR Energy
CBI sources say
-5 companies involved in scam took loan of Rs 1,000 crore
-Companies took loan to invest in stocks, manipulate share prices
-One company took loan of Rs 560 crore, another Rs 300 crore, rest Rs 50-60 crore
-Likely to write to SEBI on share price manipulation
RBI gets into action - sources say
-RBI gets into action; seeks details of all secured loans
-RBI to look into consortium loans okayed by managing comms
-RBI Seeks details from banks on 15 accounts
-All consortium loans run into thousands of crores
Companies under RBI scanner
-BGR Energy, OPG Power, Ashapura Mines, Lavasa
-DB Realty, Entertainment World Lucknow, Mantri Realty
-PK Tayal-Promoted Krishna Group, Suzlon, Pantaloon
-Indore City Treasures, Adani Group, JP Hydro, JSW Energy, Emaar MGF
Cairn - Sources
-Cairn gives into GoI demand; to ask for nod for pre-NELP blocks
-Cairn may request for Govt approval before weekend
Alert: Cairn earlier sought GoI approval for only NELP blocks
-Cairn's letter may not mention ONGC's pre-emptive rights issue
Alert: ONGC has claimed pre-emptive rights
-Cairn India declines to comment
Alert: Cairn has 3 pre-NELP blocks
Kingfisher Airlines okays debt restructuring
-Okays converting Rs 1,360 crore debt from lenders to shares
-To convert Rs 650 crore debt from promoters into shares
-To repay balance debt in 9 years with 2-year moratorium
-Interest rate on balance of debt reduced
-To issue 57.5 crore preference shares to lenders
-Preference shares to lenders redeemable at par in 12 years
DB Realty says
-Received notice from CBI to share loan sanction documents
-Went with documents today but CBI has asked to come back on Friday
-CBI only seeking info on loans sanctioned by Money Matters
-Our executives did go see RR Nair on loan sanction
-There was only 1 meeting with RR Nair in November 2009
-RR Nair wanted certain info on our projects
-No bank will give a loan to a client without a meeting
-No crossholding with DB Realty & Telco Etisalat DB
-CBI has not asked for info regarding link with Etisalat
BHEL
-Board approved setting up of a new BHEL plant as "Power Equipment Fabrication Plant" at Maharashtra.
-Forwarding proposal for initiating the process of merger of Bharat Heavy Plate & Vessels Ltd. (a wholly owned subsidiary) with BHEL
Other stocks and sectors that are in news today:
-Money Matters board to meet on Friday on further action in bribery case: NW18
-Maruti to hire 3000 employees for expanded service network – BS
-Tata Steel eyes more acquisitions – Agencies
-Nahar Poly (Nahar Investments) revises open offer price from Rs 40 to Rs 50
-TEBMA Shipyard open offer at Rs 19.20/sh (Bharti Shipyard acquired majority stake)
-Glodyne Tech: stock split: face value of 10 to become face value 6, approved fund raising
-Pratibha Industries: approves allotment of 50 crore
Ganeshaspeaks: Market prediction for Nov 26
he Moon, today is in the first charan of the Pushya Nakshatra of the zodiac sign, Cancer.
Ganeshaspeaks: Market prediction for Nov 26
From today, Mercury is in conjunction with debilitated Rahu. It's an amazing time. Unless you have delivery strength, do not even enter the market.
The pre-opening time of the market may seem positive, but in reality it may not be so. Initially, it may hover around the surface; plan your deals accordingly.
From 10:12 to 10:25, there may be a bulk deal, which may have a positive effect on Nifty.
From 12:24 to 12:36, do not take any position as the market is likely to go down.
From 12:36 to 14:00, Nifty may be on the downside.
From 14:00 to 15:10, probably, Nifty may go up.
From 15:10 till the last 10 minutes, make the last deal.
Ganesha speaks
“Shri Dharmesh Joshi is a protégé of Bejan Daruwalla and belongs to the team of astrologers declared as official successors to his astrological legacy, by none other than Bejan Daruwalla himself, in an event in Mumbai on the 23rd Nov, 2009.”
Disclaimer: The views and investment tips expressed by investment experts/astrologers on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Ganeshaspeaks: Market prediction for Nov 26
From today, Mercury is in conjunction with debilitated Rahu. It's an amazing time. Unless you have delivery strength, do not even enter the market.
The pre-opening time of the market may seem positive, but in reality it may not be so. Initially, it may hover around the surface; plan your deals accordingly.
From 10:12 to 10:25, there may be a bulk deal, which may have a positive effect on Nifty.
From 12:24 to 12:36, do not take any position as the market is likely to go down.
From 12:36 to 14:00, Nifty may be on the downside.
From 14:00 to 15:10, probably, Nifty may go up.
From 15:10 till the last 10 minutes, make the last deal.
Ganesha speaks
“Shri Dharmesh Joshi is a protégé of Bejan Daruwalla and belongs to the team of astrologers declared as official successors to his astrological legacy, by none other than Bejan Daruwalla himself, in an event in Mumbai on the 23rd Nov, 2009.”
Disclaimer: The views and investment tips expressed by investment experts/astrologers on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Mid-term Picks
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Broking house: Fullerton Securities has suggested these stocks for mid-term picks. |
SEBI lens on 9 firms for insider trading
MUMBAI: The Securities & Exchange Board of India (SEBI) has joined the Central Bureau of Investigation (CBI) to probe the possibility of insider trading in shares of at least nine companies, including LIC Housing Finance and DB Realty , named by the investigator as involved in the scandal, the biggest in a decade.
“We will look into the linkages between the information allegedly exchanged and the actual market movements. But we may have to wait till we get a more accurate picture of the entities and scrips involved in this,” said a senior SEBI official who did not want to be identified.
Trading in shares of Central Bank of India , Money Matters Financial Services , JSW Power , Religare Enterprises , Adani Enterprises , Pantaloon and Jaypee Hydro are also under the lens, the official said.
CBI on Wednesday created a storm arresting at least eight financial services executives, including LIC Housing chief executive Ramachandran Nair, for allegedly taking bribes for sanctioning loans and passing on information about transactions.
All of them are remanded to custody till Monday. These firms, including Bank of India and LIC Housing, have said they followed set standards in sanctioning loans and these would not jeopardise the interests of shareholders and institutions.
The market regulator has sought information from all the companies named by CBI, even though some of them are not accused of wrongdoing. Trading data from stock exchanges have also demanded an inspection of some people who benefited from such information that was not public. Anyone found guilty has been punished with monetary penalty, including in cases such as Gujarat NRE Coke and Manmohan Shetty of the erstwhile Adlabs.
Insider trading cases are the toughest to prove for regulators across the globe and the record so far in India has been patchy. Even in cases such as the famous one involving Hindustan Lever in the ‘90s, where the regulator penalised, appeals drag on for years before arriving at a conclusion.
SEBI’s advantage also arises from the data at depositories unlike other investigators who are not equipped to handle such information. CBI will pass on the intelligence it has gathered to SEBI, said the same official.
CBI had said LIC investment secretary Naresh Chopra had passed on sensitive insider information about several companies, including JSW Power, Religare, DB Realty, Adani, Jaypee Hydro and Pantaloon, to Rajesh Sharma, the head of Money Matters, an intermediary in bonds and loans syndication. CBI also arrested both Chopra and Sharma on Wednesday.
“We will look into the linkages between the information allegedly exchanged and the actual market movements. But we may have to wait till we get a more accurate picture of the entities and scrips involved in this,” said a senior SEBI official who did not want to be identified.
Trading in shares of Central Bank of India , Money Matters Financial Services , JSW Power , Religare Enterprises , Adani Enterprises , Pantaloon and Jaypee Hydro are also under the lens, the official said.
CBI on Wednesday created a storm arresting at least eight financial services executives, including LIC Housing chief executive Ramachandran Nair, for allegedly taking bribes for sanctioning loans and passing on information about transactions.
All of them are remanded to custody till Monday. These firms, including Bank of India and LIC Housing, have said they followed set standards in sanctioning loans and these would not jeopardise the interests of shareholders and institutions.
The market regulator has sought information from all the companies named by CBI, even though some of them are not accused of wrongdoing. Trading data from stock exchanges have also demanded an inspection of some people who benefited from such information that was not public. Anyone found guilty has been punished with monetary penalty, including in cases such as Gujarat NRE Coke and Manmohan Shetty of the erstwhile Adlabs.
Insider trading cases are the toughest to prove for regulators across the globe and the record so far in India has been patchy. Even in cases such as the famous one involving Hindustan Lever in the ‘90s, where the regulator penalised, appeals drag on for years before arriving at a conclusion.
SEBI’s advantage also arises from the data at depositories unlike other investigators who are not equipped to handle such information. CBI will pass on the intelligence it has gathered to SEBI, said the same official.
CBI had said LIC investment secretary Naresh Chopra had passed on sensitive insider information about several companies, including JSW Power, Religare, DB Realty, Adani, Jaypee Hydro and Pantaloon, to Rajesh Sharma, the head of Money Matters, an intermediary in bonds and loans syndication. CBI also arrested both Chopra and Sharma on Wednesday.
Broking houses advise caution on LIC Housing
MUMBAI: Analysts have taken a cautious view on short-term prospects of LIC Housing Finance, or LICHF, after the Central Bureau of Investigation (CBI) arrested its chief executive officer R Nair on corruption charges on Wednesday.
LIC Housing shares fell to Rs 945 intraday, before closing at Rs 1,058, down 1% over its previous close.
In its impact analysis, leading foreign brokerage house Morgan Stanley said: “The impact on earnings is uncertain, given that the situation is still evolving. However , the latest events relating to bribery charges will create pressure on multiples, especially in the context of the large valuation re-rating of the stock over the past two years.”
There was heavy trading in shares on Thursday, with close to 83-lakh shares changing hands on BSE alone, more than six times its two-week average daily volume.
“The corruption charges jeopardise the growth prospects of LICHF on one hand and raise the issue of management change on the other, given that it is the only company where the CEO was charged,” said Edelweiss Research in its report on the company soon after the arrests.
Broking firm Ambit Capital has ruled out any significant impact on the quality of the company’s loan book as the brokerage said: “Such ‘influenced’ loans seem to be a small percentage of the total loan book of LIC Housing Finance, which are not necessarily bad loans.”
Mr Nair has been the face of LIC Housing Finance to the investor community for the past two years and so the corruption charges levelled against him could impact the faith of some long-term investors in the stock, added Ambit Capital.
Ambit also feels a further 5-10 % correction in the LICHF stock could be a good entry point for investors as it believes LICHF, despite the negative events, should trade at a premium \
This is because of LICHF’s long-term competitive advantages in terms of having access to low-cost funds is on the liability side and also to parent LIC’s brand name and distribution channel on the asset side.
LIC Housing shares fell to Rs 945 intraday, before closing at Rs 1,058, down 1% over its previous close.
In its impact analysis, leading foreign brokerage house Morgan Stanley said: “The impact on earnings is uncertain, given that the situation is still evolving. However , the latest events relating to bribery charges will create pressure on multiples, especially in the context of the large valuation re-rating of the stock over the past two years.”
There was heavy trading in shares on Thursday, with close to 83-lakh shares changing hands on BSE alone, more than six times its two-week average daily volume.
“The corruption charges jeopardise the growth prospects of LICHF on one hand and raise the issue of management change on the other, given that it is the only company where the CEO was charged,” said Edelweiss Research in its report on the company soon after the arrests.
Broking firm Ambit Capital has ruled out any significant impact on the quality of the company’s loan book as the brokerage said: “Such ‘influenced’ loans seem to be a small percentage of the total loan book of LIC Housing Finance, which are not necessarily bad loans.”
Mr Nair has been the face of LIC Housing Finance to the investor community for the past two years and so the corruption charges levelled against him could impact the faith of some long-term investors in the stock, added Ambit Capital.
Ambit also feels a further 5-10 % correction in the LICHF stock could be a good entry point for investors as it believes LICHF, despite the negative events, should trade at a premium \
This is because of LICHF’s long-term competitive advantages in terms of having access to low-cost funds is on the liability side and also to parent LIC’s brand name and distribution channel on the asset side.
MRF reports 39% jump in net profit at Rs. 354 cr
Tyre manufacturer MRF on Thursday reported a 39 per cent jump in its net profit at Rs. 353.98 crore for the year ended September, 2010, over the corresponding period a year ago.
For the year ended September 30, 2009, the company had reported a net profit of Rs. 253.03 crore, the company said in a statement here.
The total income of the company for the year ended September, 30, 2010, rose by 31.50 per cent to Rs. 8,122.42 crore from Rs. 6,176.34 crore a year ago, it said.
The board of directors at its meeting held on Thursday recommended a final dividend of Rs. 19 per share for the year 2010. In addition, the directors also recommended a special dividend of Rs. 25 per share in view of the 50th year of the company, it said.
With the two interim dividends of Rs. 3 each paid early this year, the aggregate dividend for the year is Rs. 50 (500 per cent), it said.
Backed by the strong growth of automobile industry, the company said it has recorded the highest growth in a single year.
The unprecedented increase in the price of natural rubber and other raw materials continues to be a matter of concern, the statement added.
Basu advocates limited regulation of MFIs
Chief Economic Adviser Kaushik Basu on Thursday said microfinance institutions (MFIs) charge high interest rates and need to be regulated, but cautioned against excessive legislation.
"MFI interest rates are high. We need legislation to regulate it (the MFI sector)," Basu said on Thursday.
The microfinance industry faced the heat of Andhra Pradesh state government after a series of suicide cases were reported in the state, which were allegedly caused by the coercive recovery tactics employed by these institutions.
"You have to regulate it, but also have to make sure that you do not regulate it out of existence," he added.
MFIs have been criticised for charging very high interest rates and using strong-arm tactics for loan recovery. MFIs say they extend loans to unbanked areas and so the cost associated with such loans could be as high as 34 per cent of the principal amount. They usually lend money to borrowers through women's groups in remote areas.
Last week, Finance Minister Pranab Mukherjee had said the Centre intends to regulate the sector, without strangulating it.
Following a spate of suicides in Andhra Pradesh, the state government passed an ordinance on October 15 making it mandatory for all MFIs to register their activities with the district Registering Authority. Furthermore, the MFIs were directed to increase the loan repayment period for self help groups (SHG) to 30 days, as against the earlier practice of 15 days.
This has impacted the collections of MFIs, as loan recovery activities were impacted and bank financing has also become more difficult to secure.
The government is in the process of finalising a draft Bill to ensure the development and orderly growth of the microfinance sector in rural and urban areas. The Bill would be introduced in Parliament after taking into account the views of the Reserve Bank and the recommendations of an RBI sub-committee.
Last month, the Reserve Bank appointed a committee under the chairmanship of YH Malegam to examine the state of the MFI sector. The committee will submit its report by January.
Private equity group KKR to buy Del Monte
Del Monte Foods Co. on Thursday agreed to be bought for $4 billion in cash by a group of investors that includes its former owner in what would be the biggest private equity deal of the year.
An investor group led by Kohlberg Kravis Roberts & Co. — which briefly owned Del Monte — Vestar Capital Partners and Centerview Partners agreed to buy the food maker for $19 per share. They will also assume $1.3 billion in debt.
The purchase price is a 6 percent premium to the stock's closing price on Wednesday, though the stock has soared recently on published reports about a possible buyout. The stock is up 59 percent since the beginning of the year, including a 12 percent jump on Nov. 18 when rumors of the deal surfaced.
Del Monte, based in San Francisco, is the owner of several well-known pet-food brands, including Kibbles 'n Bits, Meow Mix and Milk-Bone. It also has food brands under the Del Monte, Contadina, College Inn and S&W names.
The private equity firms in the deal have a long history with food makers.
KKR has bought food and beverage companies such as Beatrice Cos., RJR Nabisco and Borden Foods. It acquired Del Monte as part of its $25.1 billion leveraged buyout of Nabisco in 1989, and then sold Del Monte soon afterward. And Centerview's co-founder, Jim Kilts, is a former CEO of Kraft.
It is also the second pet-food deal of the year for KKR, which acquired British pet retailer Pets At Home in January.
After a lull during the recession, more private equity deals are springing up. At $4 billion, the Del Monte deal is the largest private equity acquisition of the year, ahead of Extended Stay Inc., which agreed to be bought in May for $3.92 billion.
Consumer goods companies have been popular targets lately, which could mean that private equity firms are feeling increasingly confident that consumers are likely to start spending more and keep it up.
On Friday, clothing seller J. Crew Group Inc. agreed to be taken private for $3 billion by TPG Capital and Leonard Green & Partners. And Burger King Holdings agreed to be taken private for $3.26 billion in September.
Del Monte CEO Richard Wolford said the deal "delivers substantial shareholder value and is a clear endorsement of Del Monte's strategic success and effective execution."
In its last fiscal year, which ended in May, Del Monte Foods' profit climbed almost 42 percent while revenue rose 3 percent to $3.74 billion. But in September, Del Monte said its fiscal first-quarter revenue softened on weakness in the consumer business and the company trimmed its expectations for revenue growth this year.
Over the past 10 years, the company has grown through acquisitions, and is now a company that gets more than half of its revenue from pet food. In 2006, it sold its retail private label soup and gravy business as well as its U.S. infant feeding business and acquired the Meow Mix and Milk-Bone brands. It began trading publicly in 1999.
Asian markets mixed as Europe debt worries linger
Asian stock markets were mixed Friday after a muted performance in Europe where concerns remain about the possibility of further bailouts for debt-laden nations in the euro bloc.
Japan's Nikkei 225 stock average added 0.1 percent to 10,088.44 while South Korea's Kospi was down 0.5 percent at 1,917.15. Hong Kong's Hang Seng was up 0.1 percent at 23,071.62.
China's Shanghai Composite Index fell 0.9 percent to 2,872.81 and Australia's S&P/ASX 200 added 0.2 percent to 4,601.80. Elsewhere, markets in Singapore, Taiwan and New Zealand fell.
Before trading opened in Tokyo, the government released data showing that consumer prices in Japan fell during October compared to a year earlier, for the 20th straight month.
Deflation, which cuts into company profits and can cause job and wage cuts, is a major concern for the country. The Japanese parliament is due to pass a new $61 billion stimulus package later Friday.
The losses in Asia came after limited gains in Europe, where investors were wary of further debt problems across the Continent.
Key indexes in Britain, Germany and France ended higher but stock exchanges in Ireland, Portugal, Spain and Greece — countries at the forefront of investor concerns over Europe's debt crisis — closed lower.
Financial markets in the U.S. were closed for the Thanksgiving holiday.
After the Irish government agreed to austerity measures in exchange for a lifeline from the European Union and the International Monetary Fund, concerns remain over whether Portugal or larger Spain will also be forced to ask for bailouts.
Japan's Nikkei 225 stock average added 0.1 percent to 10,088.44 while South Korea's Kospi was down 0.5 percent at 1,917.15. Hong Kong's Hang Seng was up 0.1 percent at 23,071.62.
China's Shanghai Composite Index fell 0.9 percent to 2,872.81 and Australia's S&P/ASX 200 added 0.2 percent to 4,601.80. Elsewhere, markets in Singapore, Taiwan and New Zealand fell.
Before trading opened in Tokyo, the government released data showing that consumer prices in Japan fell during October compared to a year earlier, for the 20th straight month.
Deflation, which cuts into company profits and can cause job and wage cuts, is a major concern for the country. The Japanese parliament is due to pass a new $61 billion stimulus package later Friday.
The losses in Asia came after limited gains in Europe, where investors were wary of further debt problems across the Continent.
Key indexes in Britain, Germany and France ended higher but stock exchanges in Ireland, Portugal, Spain and Greece — countries at the forefront of investor concerns over Europe's debt crisis — closed lower.
Financial markets in the U.S. were closed for the Thanksgiving holiday.
After the Irish government agreed to austerity measures in exchange for a lifeline from the European Union and the International Monetary Fund, concerns remain over whether Portugal or larger Spain will also be forced to ask for bailouts.
