SPECIAL COVERAGE
CHANDIGARH

LUDHIANA

DELHI



THE TRIBUNE SPECIALS
50 YEARS OF INDEPENDENCE

TERCENTENARY CELEBRATIONS
B U S I N E S S

Telenor to buy 67.25% in Unitech Wireless
New Delhi, March 17
Within days of country’s telecom regulator, TRAI, suggesting a three-year lock-in period for the start-up telecom firms here before selling their stake, one of the beneficiaries of the open regime, Unitech Wireless, has sealed its sell-off deal with Norwegian telecom major Telenor with a revised equity infusion.

Satyam to scrutinise bids by week-end
Mumbai, March 17
The government-appointed board will look into the bids for strategic stake in Satyam Computer on Friday or Saturday, said a source in know of the developments today. At least seven companies, including Larsen & Toubro, i-Gate, Spice and Mahindra Group, have already submitted proposals to the board last week.

CBI seeks extension of Raju’s custody
B Rama RajuHyderabad, March 17
The CBI, probing the Rs 7,800-crore fraud in Satyam Computers, today sought extension by two days the custody of disgraced chairman of the software giant B Ramalinga Raju, his brother B Rama Raju and former chief financial officer V Srinivas.



EARLIER STORIES




Bank of Japan Governor Masaaki Shirakawa leaves a room after a news conference at the bank in Tokyo on Tuesday. The Bank of Japan offered up to $10.2 billion in subordinated loans to Japanese banks to bolster their depleted capital, seeking to prevent a drying up of lending to companies and households in
Bank of Japan Governor Masaaki Shirakawa leaves a room after a news conference at the bank in Tokyo on Tuesday. The Bank of Japan offered up to $10.2 billion in subordinated loans to Japanese banks to bolster their depleted capital, seeking to prevent a drying up of lending to companies and households in 
need of cash. — Reuters

Direct tax kitty swells by 18 pc
New Delhi, March 17
The direct tax collection of the government has shown an improvement of over 18 per cent as compared to last year. Income tax, service tax, and corporate tax, which account for direct taxes, have yielded the government Rs 2,96,200 crore this fiscal so far.

Nokia to cut 1,700 jobs
New York, March 17
The world's largest mobile phone maker Nokia will be trimming its workforce by 1,700 employees worldwide, as part of the company's cost-cutting efforts.

Import of sensitive items up 33 pc
New Delhi, March 17
Import of refined oil saw a huge jump of 132 per cent, followed by 52.6 per cent in alcoholic beverages and 48.9 per cent in cotton and silk during the April-December period of fiscal 2008-09.


This file photo of the Ford plant in Saarlouis, southwestern Germany, shows an employee fixing the company's logo on a car. US automaker Ford said on Monday it would cut European production in light of slumping demand, but would avoid outright firings.
This file photo of the Ford plant in Saarlouis, southwestern Germany, shows an employee fixing the company's logo on a car. US automaker Ford said on Monday it would cut European production in light of slumping demand, but would avoid outright firings. — AFP

RCom’s offer for GSM subscribers
New Delhi, March 17
Reliance Communications (RCom), country’s only telecom service provider to offer nationwide GSM and CDMA services, today said it was launching a special unlimited free On-Net Calling Pack for its GSM customers in Delhi.

Bulk Deposits
PSUs restrained from inviting bids
Chandigarh, March 17
Cash-rich public sector enterprises (PSEs) can no longer make a quick buck by auctioning and then placing its deposits to banks quoting the highest interest rate. The Ministry of Heavy Industries and Public Enterprises has now asked all central public sector undertakings (CPSEs) not to invite bids from banks for placing their bulk deposits.

 





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Telenor to buy 67.25% in Unitech Wireless
Girja Shankar Kaura
Tribune News Service

New Delhi, March 17
Within days of country’s telecom regulator, TRAI, suggesting a three-year lock-in period for the start-up telecom firms here before selling their stake, one of the beneficiaries of the open regime, Unitech Wireless, has sealed its sell-off deal with Norwegian telecom major Telenor with a revised equity infusion.

As part of the new deal, the Norwegian company will acquire a controlling stake in Unitech through fresh equity infusion.

After another of the start-up telecom companies, Swan Telecom, sold off its 45 per cent stake to Telecommunications Corp. (Etisalat) for $900 million putting the value of Swan shares at staggering $2 billion, Unitech Wireless had entered into a deal with Telenor, raising eyebrows in the country.

Telenor announced in October last that it had acquired a 60 per cent stake in Delhi-based realty company Unitech’s telecom venture for Rs 6,120 crore ($1.1 billion). The deal was to have been completed by September 2009.

As per the latest reports, the Norwegian telecom major has readjusted its stake valuation in Unitech Wireless. Now, Telenor would get 67.25 per cent stake in Uintech as against 60 per cent in the earlier agreement. This would, however, bring down the enterprise valuation of Unitech Wirelsss to about Rs 10,900 crore.

As part of the re-worked deal, Telenor will infuse cash in four stages and at each phase, it will increase its stake in Unitech Wireless. In the first phase, it will get a 33.5 per cent ownership in Unitech Wireless.

In a statement issued here, it said, “Telenor and Unitech Ltd have agreed to proceed with completion of the transaction with certain adjustments. While Telenor's initial investment under the agreement will continue to be the previously agreed Rs 61.2 billion (approx. $ 1.2 billion), it has been agreed that Telenor, after this investment, would be holding 67.25 per cent in Unitech Wireless (subject to regulatory approval)”.

The statement further added, “Upon completion of the first phase of the investment, Telenor's ownership percentage will be 33.5 per cent and the transaction, and the first phase of Telenor's investment, will be completed shortly, as the closing formalities related thereto have been finalised.”

Reports suggest that deal could still be under scrutiny. As a result, the statement says that the deal would be subject to regulatory approvals.

Telenor, incidentally, has operations in Pakistan and Bangladesh which could prove to be a impediment to its entry into India, especially keeping in mind the security issues that the country has with its two neighbours.

The Home Ministry has been keeping a watch on such companies and could eventually end up making the final decision. 

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Satyam to scrutinise bids by week-end

Mumbai, March 17
The government-appointed board will look into the bids for strategic stake in Satyam Computer on Friday or Saturday, said a source in know of the developments today. At least seven companies, including Larsen & Toubro, i-Gate, Spice and Mahindra Group, have already submitted proposals to the board last week.

L&T rules out tie-up

Engineering major Larsen & Toubro on Tuesday said it was going alone with its bid for acquiring Satyam Computer and has no plans to join any other player.

"We are not in discussions with private equity firms to jointly bid for Satyam," Y M Deosthalee, Director (Finance) of L&T told PTI.

He was responding to reports that L&T was in talks with Blackstone, the Carlyle Group, Goldman Sachs and Temasek, among others, to jointly bid for Satyam.

L&T, which was the first to throw its hat in the ring for Satyam, had earlier said it had enough cash, about Rs 4,000 crore to go for the acquisition.

"The board will meet either on Friday or Saturday...the board expects to reach clarity on the time-frame to complete the selection process by next week," the source told PTI here.

Satyam expects to chalk out a time-frame for the selection process by next week to end the uncertainly on the future of the troubled IT major, the source said.

The board has already said that it has received adequate interest from both Indian and international bidders, including private equity firms.

As per the guidelines set by the board, interested parties have to submit bids by March 20 with proof of funds of Rs 1,500 crore.

To ensure hassle-free and transparent bidding, the board had appointed former Chief Justice of India S P Bharucha to oversee the process.

The board is understood to have met Justice Bharucha in Mumbai last week to discuss the sale process.

Considered a frontrunner, L&T has appointed Citi and Nomura to advise it on a possible deal with Satyam.

At present, the engineering major has 12 per cent stake in the target firm and is believed to be in talks with private equity firms to mop up funds for the stake buy.

A few other bidders like i-Gate have reportedly sought more accurate estimates of the actual liabilities of Satyam, which is yet to be ascertained.

The government scrapped the former Satyam board and reconstituted it with a group of experts after the Hyderabad-based firm's founder-chairman B Ramalinga Raju confessed to gross manipulations in the company's balance-sheet.— PTI

Telstra ends contract

Melbourne: Australian telecom giant Telstra has reportedly dropped outsourcing partner Satyam Computer Services from an applications support contract worth $32 million (Aus) annually.

The troubled Indian outsourcing firm's IT contracts with Telstra will be passed on to EDS, according to sources that were quoted by a 'The Australian' daily here today.

Telstra chief executive Sol Trujillo, who leaves the company on June 30, sat on the board of EDS before joining the telco in 2005, the report said.

According to the daily, Telstra refused to comment on the report of dumping Satyam and said the decision about its supply arrangements with individual vendors was not for media release.

'The Australian' further said that new Satyam chief executive A S Murty is understood to have flown to Australia last week in a last-ditch bid to retain the Telstra contract and the Indian IT company placed a compelling case to continue with Telstra.

The recent fraud at Satyam is believed to have led to the fallout, but a source close to the deal denied that the IT firm's scandal was responsible for Telstra's decision to tear up its contract, saying it was instead linked to the Indian outsourcer's performance.

The decision was taken by a Telstra advisory board, which was advised by a US tender management company, sources said. — PTI

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CBI seeks extension of Raju’s custody
Tribune News Service

Hyderabad, March 17
The CBI, probing the Rs 7,800-crore fraud in Satyam Computers, today sought extension by two days the custody of disgraced chairman of the software giant B Ramalinga Raju, his brother B Rama Raju and former chief financial officer V Srinivas.

With the seven-day CBI custody ending today, the central investigating agency moved a petition for extension of their custody before the 14th Additional Chief Metropolitan Magistrate S Samuel Victor Emmanuel here.

The Raju brothers, Srinivas and the sacked PriceWaterhouse partners S Gopalakrishnan and T Srinivas were brought to the court from Chanchalguda jail.

The magistrate adjourned the hearing to tomorrow. Following this, all accused were sent back to the jail. Their judicial custody ends on March 20.

While seeking extension of custody, the prosecution told the court that it wanted to interrogate them further to ferret out the truth.

The court had on March 9 sent the accused to CBI custody for seven days.

The CBI’s multi-disciplinary investigation team (MDIT) headed by the agency’s DIG V V Lakshmi Narayana grilled them at the state-owned Dilkusha Guest House here, which is serving as the camp office of MDIT.

The investigation into the biggest scandal in the country’s corporate history was handed over to CBI last month, following pressure from the opposition parties who accused the Congress government of adopting soft approach towards Raju.

The federal investigating agency will focus on how Ramalinga Raju manipulated the accounts for years without being noticed, the involvement of other company officials, diversion of Satyam funds to over 300 companies floated by him and his family members and purchase of lands and other property by the accused.

There are allegations that Raju had diverted Satyam funds to real estate and infrastructure firms owned by his sons.

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Direct tax kitty swells by 18 pc
Tribune News Service

New Delhi, March 17
The direct tax collection of the government has shown an improvement of over 18 per cent as compared to last year. Income tax, service tax, and corporate tax, which account for direct taxes, have yielded the government Rs 2,96,200 crore this fiscal so far.

The tax authorities feel that the target of Rs 3,45,000 crore for 2008-09 will be met.

“Direct tax collection at Rs 2,96,200 crore showed an improvement of 18 per cent year-on-year,” a finance ministry official said.

Despite a slowdown, there is growth of 36 per cent in corporate tax deducted at source (TDS) and a growth of 17 per cent in non-corporate TDS.

The revised target for direct tax collection was lowered by Rs 20,000 crore from the budget estimate of Rs 3,65,000 crore for the current fiscal year.

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Nokia to cut 1,700 jobs

New York, March 17
The world's largest mobile phone maker Nokia will be trimming its workforce by 1,700 employees worldwide, as part of the company's cost-cutting efforts.

The firm in a statement today said actions would be taken at its devices and markets units as well as in the corporate development office and global support functions.

When contacted, a company spokesperson had said that voluntary departure package would not impact its India operations. In fact, the company is still recruiting in India. — PTI

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Import of sensitive items up 33 pc

New Delhi, March 17
Import of refined oil saw a huge jump of 132 per cent, followed by 52.6 per cent in alcoholic beverages and 48.9 per cent in cotton and silk during the April-December period of fiscal 2008-09.

The import of other sensitive items like rubber, marble and granite, automobiles and auto-parts also saw a significant increase in the third quarter of 2008-09, according to the official data released here today.

However, the overall import of sensitive items went up by 33 per cent, compared with the 44.8 per cent increase in India's total imports.

The average import of sensitive items grew at a lesser pace than the country's total imports, thanks to foodgrain import that shrank by 98.6 per cent.

The sensitive items, though constitute 3.4 per cent of the total import basket, they are monitored by the government to see whether they are causing any adverse impact on the domestic industry, particularly the small and medium sector.

Import of sensitive items, including from China and the US, shot up to Rs 33,864 crore in the first nine months of this fiscal from Rs 25,454 crore in the same period last year.

Import of alcoholic beverages during the period was valued at Rs 294 crore, while that of cotton and silk was at Rs 1,238 crore.

India's total imports stood at Rs 10,03,947 crore during April-December, against Rs 6,93,445 a year ago.

However, import of the sensitive items from countries like Canada and Argentina have shown a decline.

The import of edible oil increased to Rs 10,943 crore during the period from Rs 8,439 crore a year earlier.

"The increase in edible oil imports is mainly due to substantial increase in import of crude palm oil and its fractions," the data said.

Imports of SSI products, including umbrella and locks, increased to Rs 872 crore in April-December 2008, 23.5 per cent more than Rs 706 crore a year ago.

The country's import of items like bamboos, cocoa and copra and sugar too surged by 279.4 per cent to Rs 205 crore.— PTI 

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RCom’s offer for GSM subscribers
Tribune News Service

New Delhi, March 17
Reliance Communications (RCom), country’s only telecom service provider to offer nationwide GSM and CDMA services, today said it was launching a special unlimited free On-Net Calling Pack for its GSM customers in Delhi.

As part of the pack, a recharge of Rs 169 would allow GSM subscribers to enjoy unlimited calling to any local Reliance Mobile GSM number for a period of 30 days.

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Bulk Deposits
PSUs restrained from inviting bids
Ruchika M. Khanna
Tribune News Service

Chandigarh, March 17
Cash-rich public sector enterprises (PSEs) can no longer make a quick buck by auctioning and then placing its deposits to banks quoting the highest interest rate. The Ministry of Heavy Industries and Public Enterprises has now asked all central public sector undertakings (CPSEs) not to invite bids from banks for placing their bulk deposits.

This order follows an earlier order by the Ministry of Finance, asking banks not to bid for bulk deposits and instead quote only the card rate for getting these bulk deposits. The move is expected to facilitate a general reduction in the cost of deposits, paving the way for a further cut in lending rates.

The Department of Public Enterprises (DPE) in the Ministry of Heavy Industries and Public Enterprises, while barring the CPSEs from inviting bids for higher value rates of interest on their bulk deposits, have also asked them to renew their deposits with the same bank. The public sector undertakings have been told that all deposits maturing up to June 30, will be placed with the same bank at the published bulk deposit rates.

Over the past couple of years, the PSEs had started auctioning its cash deposits and banks began competing with each other to get these deposits by quoting a higher value rate of interest (finer rate of interest). This was generally one to 1.5 per cent higher than the prevailing card rate. Each year, the banks would set up teams to chalk out the deposit mobilisation and visit government offices and health and educational institutions, offering them higher rates of interest.

Earlier, banks had been facing a liquidity crunch because of high lending costs. They were, thus, trying to cap maturing bulk deposits and reduce lending costs by offering higher interest rates. In February last year, some banks were offering as high as 9.10 per cent rate of interest for a period of 46 days, and 9.30 per cent interest on a bulk deposit for 91 days. In fact, this “deposit mobilisation” war between banks would start in February and continue till March as a result of the banks’ trying to make up the year-end targets.

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BRIEFLY

ATC to buy XCEL Telecom
New Delhi
: American Tower Corporation (ATC) on Tuesday said it would acquire Indian telecom infrastructure firm XCEL Telecom Pvt Ltd for an undisclosed amount. ATC's Mauritian subsidiary American Tower Mauritius has entered into an agreement with Horse-Shoe Capital, Mauritius, owner of XCEL Telecom, for acquiring the Indian tower company, a joint statement from ATC and XCEL said.— TNS

Tally’s new software
Chandigarh
: Accounting software major Tally Solutions Pvt Limited has launched ERP 9, which promises to enhance all business practices by providing path-breaking features and capabilities. Bharat Goenka, managing director of the company, said with the release of Tally.ERP 9, it was also introducing an enabling environment called Tally.NET. The revolutionary capabilities of Tally.ERP 9 together with Tally.NET allows the user to access their business data from anywhere in the world. — TNS

BoI cuts lending rates
Mumbai
: State-run Bank of India on Tuesday cut its benchmark prime lending rate (BPLR) by 0.5 per cent from 12.5 per cent to 12 per cent, effective from April 1. The reduction in BPLR will be applicable to all portfolios related to BPLR, a BoI official said here.— PTI

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