Professional Documents
Culture Documents
Usually the price at which the new shares are issued rights
issues is less than the current market price of the stock
Rights issue are different from bonus issue as one is paying money to get
additional shares and hence one should subscribe to it only if he/she is
completely sure of the company performance.
One must not take up the rights if the share price has fallen below the
subscription price as it may be cheaper to buy the shares in open market.
Private Equity
Private Equity
Project Consulting
Corporate Restructuring
Bidding Advisory
Services that make up the Business
Advisory Services:
Entry Strategy Plans
Corporate Plans
Business Alliances
Cross-Border Investments
Investment Banking
and Merchant Banking
Difference between Investment
Banking and Merchant Banking
HDFC asset management company ltd PNB appointed i-Bankers for selling 32%
appointed Kotak investment banking stake in PNB housing finance.
• AXIS CAPITAL
• BofA MERRILL LYNCH Other examples :
• CLSA INDIA PVT LTD • J. S. MORGAN & CO.
• ICICI SECURITIES • BROWN BROTHERS HARRIMAN & CO.
• IIFL HOLDING LTD. • SAMUEL MONTAGU & CO.
• J.P. MORGAN & Co. • H. J. MERCK & CO
for IPO launch
Financial Engineering
DEFINIATION
High Risk
Long-term investments
Lack of liquidity
Participation in management
Process of Venture Capital Financing
Deal Orientation
Screening
Evaluation
Deal-structuring
Post-investment activity
Exit Plan
Advantages of Venture Capital
The business does not stand the obligation to repay the money.
Benefit from such financing can be realised in the long run only.
MERGERS & ACQUISITIONS
Meaning
Economies of scale
Economies of scope
Tax Shield
Industry Consolidation
Diversification
Earnings Growth
Difference between Mergers & Acquisitions
MERGERS ACQUISITIONS
Merging of 2 organizations to 1 Buying one organization by another
Dilution of ownership occurs in mergers The acquirer does not experience the
dilution of ownership
Merger is expensive and time consuming Acquisition is less expensive and faster and
easier transaction
For example, GlaxoWellcome and SmithKline Dr. Reddy's Labs acquired Betapharm through
Beehcam ceased to exist and merged to an agreement amounting $597 million
become a new company, known as Glaxo
SmithKline.
Important terms in a Merger
Synergy:- Synergy is the magic force that allows for enhanced cost
efficiencies of the new business. Synergy takes the form of revenue
enhancement and cost savings
• Participants:
• Borrower
• Arranger
• Co-arranger
• Agent
• Co-lender
STAGES OF LOAN SYNDICATION PROCESS
3. Post-closure stage
FDI & FII
FOREIGN DIRECT INVESTMENT & FOREIGN INSTITUTIONAL INVESTOR
Foreign Direct Investment - FDI