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L&T Finance acquires Fidelity’s Indian MF business

YM Deosthalee, CMD of LTFH, said, “This acquisition provides L&T Mutual Fund the necessary scale, products and access to retail customers to grow profitably.”

L&T Finance (LTF), a subsidiary of L&T Finance Holdings Ltd (LTFH), has executed definitive agreements to acquire FIL Fund Management Pvt Ltd (Fidelity AMC) & FIL Trustee Company Pvt Ltd, the companies carrying on the mutual fund business of Fidelity in India, subject to regulatory approvals.

Fidelity AMC, incorporated in 2004, manages the 15th largest mutual fund in India with a market share of 1.3% and an average AUM for the quarter ended December 2011 of Rs8,881 crore (about 68% of its assets are equity oriented). It has built a robust equity oriented franchise which has access to large HNI customers and a strong SIP portfolio. Its equity assets are the tenth largest in India with a market share of 3.1%. Further, in the past 3 years, the fund performance has resulted in 4 of its 5 equity funds being ranked amongst top 10 in their respective category.

YM Deosthalee, CMD of LTFH, said, “This acquisition provides L&T Mutual Fund the necessary scale, products and access to retail customers to grow profitably.”

“The strong equity-focus of Fidelity's Indian Mutual Fund, when combined with L&T Mutual Fund, results in a balanced asset base. The size of the combined entity (average AUM of about Rs13,497 crore for the quarter ended December 2011, with a market share of about 2.0%) together with the backing of the ''L&T'' brand would provide an optimal platform to improve margins and grow profitably. Together, the complementary skill sets, distribution reach and client base present a well balanced overall picture,” said N Sivaraman, president & whole-time director, LTFH. Lazard was the financial advisor to L&T Finance in the transaction.

In the early afternoon, Larsen & Toubro was trading at around Rs1,312 per share on the Bombay Stock Exchange,  0.68% up from the previous close.

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CCI approves merger of subsidiaries with Reliance Infrastructure

The companies are either directly or indirectly wholly-owned subsidiaries of RInfra and the ultimate control over them remains with it

Competition watchdog CCI has approved the proposal of Reliance Infrastructure (RInfra) to merge five wholly-owned subsidiaries with itself.
It has also approved the demerger of the container business of Reliance Infrastructure Engineers Pvt Ltd (RIEPL) from the company.  

The five subsidiaries are Reliance Energy Ltd (REL), Reliance Energy Generation Ltd (REGL), Reliance Goa and Samalkot Power Ltd (RGSPL), Reliance Infraventures Ltd (RIVL) and Reliance Property Developers Ltd (RPDPL), the Competition Commission of India (CCI) said in its order.

"...it is observed that for the financial year 2010-11, the turnover of REL, REGL, RGSPL, RIVL, RPDPL and RIEPL from business operations is either nil or negligible," the order said.

It added that these companies are either directly or indirectly wholly-owned subsidiaries of RInfra and the ultimate control over them remains with it.

All these five companies are currently not carrying out any business activities, the order said, however, RIEPL is engaged in engineering, design and consultancy services and in container train operation business.

"Considering the facts on record and the details provided in the notice given under section (2) of Section 6 of the Act (Competition Act, 2002) and the assessment of the proposed combination is not likely to have an appreciable adverse effect on competition in India and therefore, the Commission hereby approves the proposed combination under sub-section (1) of Section 31 of the Act," it said.

RInfra is engaged in generation, transmission and distribution of electricity and in undertaking engineering, procurement and construction contracts for the power stations and related activities, it added.

In the early afternoon, Reliance Infra was trading at around Rs575.80 per share on the Bombay Stock Exchange, 1.12% down from the previous close.

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