No move likely on MTNL-BSNL merger

24th June 2005: The much talked merger of two telecom PSUs - MTNL and BSNL - is understood to have been put on hold due to MTNL's reservations over becoming a subsidiary of BSNL. According to sources, there has been no movement on the proposed synergy between the telecom firms.

A high powered committee in the department of telecom (DoT) was considering four options in this regard. The options include divestment in BSNL to make it a listed entity for the smooth merger between the two or making BSNL a subsidiary of MTNL.

A K Sinha, CMD of BSNL, said: "The decision is with DoT. We have given our views and recommendations after being asked for it. The government has to decide. We are not in the picture on the overall decision."

Fast Track Entertainment Ltd to acquire G Infotainment Ltd

22nd June 2005: Fast Track Entertainment Ltd is to acquire N Chandra G Infotainment Ltd against a share swap of 1.20 crore equity shares of Rs 1 each at a premium of Rs 19 each to the shareholders of N Chandra on a preferential allotment basis. The merger would be in accordance with the provisions of the Companies Act, 1956, Fast Track informed the BSE today. The company has appointed Deloitte Haskins & Sells as valuer to evaluate share swap for this acquisition, it said.

Federal Bank eyes merger with south-based bank

21st June 2005: The fifth largest private sector bank, Federal Bank Ltd is eyeing a merger with an old private south-based bank. “We want to change our image from being strong in Kerala to being a south-based bank,” the bank’s chairman & CEO M Venugopalan said.

Federal Bank also proposes to raise about Rs 350-crore either by way of a public offering or a global depository receipt (GDR) latest by September end. The preference today is for a public issue in order to improve the liquidity of the bank shares in the domestic market.

Following the public issue/GDR, ICICI Bank’s 20% holding in Federal Bank will stand reduced to about 15%, said Venugopalan. “The fund-raising exercise will help meet our growth plans for the next two years,” said Venugopalan. The bank has targeted a growth rate of 30% in advances during the current year, against last year’s actual growth rate of 24%. The bank’s current capital adequacy ratio stands at 11%.

Speaking on the possibility of merger with a south-based bank, Venugopalan declined to name any specific bank, stating that talks have not taken place. However, he pointed to quite a few strong players in the south including Indian Bank, The Lakshmi Vilas Bank Ltd, Karnataka Bank, South Indian Bank and Lord Krishna Bank Ltd, and Dhanalakshmi Bank Ltd among others.