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Hush-hush tales from the world of stock markets, banking, corporate world and corridors of power

MC Insider: Akasa plane order, pharma deal, EV battery buzz, legal battles and more

Hush-hush tales from the world of stock markets, banking, corporate world and corridors of power

Last Updated: October 04, 2021 / 07:47 AM IST

VALUATION DIVIDE

VALUATION DIVIDE

Entrepreneurs who have built businesses over decades, and private equity investors who have backed them, are lamenting over startup valuations, where billions of dollars are seemingly unearthed every day. One such founder recently expressed shock when his annual net profit turned out to be more than his 'tech' rival's revenue. And oddly enough, the tech rival is valued at more than 10 times this traditional company! "Looks like a cruel world sometimes," he quipped! We feel your pain, sir!

BITTER PILLS

BITTER PILLS

The promoters of this pharma firm may be licking their wounds after their bet on a firm outside their sector didn’t exactly go according to plan. But going by market chatter, the move may not have deterred them from eyeing assets outside their core business. Rumour has it that a hospital in Western India has caught their fancy. Is it just mere flirting with the idea or do they mean serious business? We ain’t sure, but if the buzz is true, it would be the latest example of consolidation in the segment.

NOT SO FAST 

NOT SO FAST 

Everybody is wondering what happened to the B737 MAX order from Akasa. Boeing was expected to seal the deal but turns out the frontrunner has competition now. Akasa is now more than willing to negotiate harder by bringing in more players in the game, we hear. Is this how founder Rakesh Jhunjhunwala negotiates or has the airline’s management got external advice on how airlines can get better plane deals when more makers are in the fray? Either way, what was Boeing's order may now be someone else's.

DIVERSIFICATION LURE 

DIVERSIFICATION LURE 

Sticking to the healthcare. Here’s another diversification titbit that is doing the rounds: The bold acquisition of Thyrocare by an IPO-bound pharmacy has definitely forced several players in the industry to wake up and smell the ‘phygital’ coffee! We hear that a prominent financial services player is weighing an entry in this hot space. So what could be the target? Could it be the one that has already attracted interest from other suitors? Wink! Wink!

ELECTRIFYING DEALS

ELECTRIFYING DEALS

Reliable and sufficient electric vehicle infrastructure (charging stations and manufacturing capacity) is critical to the success of the EV ecosystem in India. And that creates opportunities for win-win partnerships. A curious birdie tells us a big deal is in the works in the EV battery production segment and may be announced this month. And no, it’s not a desi deal. One of the parties is a foreign player. We can’t say any more!

DEALMAKERS ARE BUSY PACKING!

DEALMAKERS ARE BUSY PACKING!

Rumour has it that yet another packaging deal may be in the works. Adding to the 2 others in the market, one of which seems to have lost steam for now. Favourable valuations in the sector have triggered many of these exit plans and this new one has already seen decent traction. We hear an Asian suitor is circling around it. Will it edge out the PE funds that have been lured by this segment in recent times? Let’s wait and watch!

MIGRATION OF DEALS

MIGRATION OF DEALS

The widening gap in valuations between private markets and public markets has prompted many promoters to abruptly drop stake sale plans and explore the listing route. In recent months, this trend has been observed in the healthcare and life-sciences segment. Capital markets advisors may be rubbing their hands with glee, but M&A folks are not exactly impressed. One belonging to the latter category quipped, "When valuations are 2x to 3x higher in some cases, the temptation to switch will always be there. Plus in many of these converts, original plans of PE funding hadn’t really taken off."

SQUID GAME INDIAN STYLE?

SQUID GAME INDIAN STYLE?

When the Chinese short-video platform Tiktok was banned, many of its Indian clones stepped up to fill in to void the platform created. While some found success, others like this platform are struggling. "It is like watching a horror show unfolding," noted one of the early employees of one such company. The short video format is not working for the firm, for there are too many, and the company is just burning cash. "The worst of all, founders are indecisive about what to do and are not moving fast enough," says the employee. According to him, if something is not done fast enough, the company will fold, and he may lose his job along with others. "It is a horror story indeed to watch the company you are working for die a slow death," the exasperated employee stated.

LAW AND BEHOLD! WHO’S THAT GUY?

LAW AND BEHOLD! WHO’S THAT GUY?

A recent high court hearing to address a technical dispute between former directors of a private bank and the regulator was supposed to be a routine affair. The case pertained to some directors moving court against the rejection of their candidature to the Board position. But there was a surprise for everyone in the courtroom. As the proceedings began, one name that popped up among the list of advocates who argued for one of the petitioners was that of a top politician who used to be a former cabinet minister! Some believed it was quite unusual for the top politician/lawyer to appear for such a case. Anyway, the matter was adjourned and a decision is pending. Meanwhile, wanna take a shot at guessing the name of the legal eagle?

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