Warner Bros. again rejected Paramount’s latest takeover bid and told shareholders Wednesday to stick with a rival offer from Netflix.Warner’s leadership has repeatedly rebuffed Skydance-owned Paramount’s overtures — and urged shareholders just weeks ago to back the sale of its streaming and studio business to Netflix for $72 billion. Paramount, meanwhile, has sweetened its $77.9 billion offer for the entire company and gone straight to shareholders with a hostile bid.Warner Bros. Discovery said Wednesday that its board determined Paramount’s offer is not in the best interests of the company or its shareholders. It again recommended shareholders support the Netflix deal.Late last month Paramount announced an “irrevocable personal guarantee” from Oracle founder Larry Ellison — who is the father of Paramount CEO David Ellison — to back $40.4 billion in equity financing for the company’s offer. Paramount also increased its promised payout to shareholders to $5.8 billion if the deal is blocked by regulators, matching what Netflix already put on the table.The battle for Warner and the value of each offer grows complicated because Netflix and Paramount want different things. Netflix’s proposed acquisition includes only Warner’s studio and streaming business, including its legacy TV and movie production arms and platforms like HBO Max. But Paramount wants the entire company — which, beyond studio and streaming, includes networks like CNN and Discovery.If Netflix is successful, Warner’s news and cable operations would be spun off into their own company, under a previously-announced separation.A merger with either company will attract tremendous antitrust scrutiny. Due to its size and potential impact, it will almost certainly trigger a review by the U.S. Justice Department, which could sue to block the transaction or request changes. Other countries and regulators overseas may also challenge the merger.
NEW YORK —
Warner Bros. again rejected Paramount’s latest takeover bid and told shareholders Wednesday to stick with a rival offer from Netflix.
Warner’s leadership has repeatedly rebuffed Skydance-owned Paramount’s overtures — and urged shareholders just weeks ago to back the sale of its streaming and studio business to Netflix for $72 billion. Paramount, meanwhile, has sweetened its $77.9 billion offer for the entire company and gone straight to shareholders with a hostile bid.
Warner Bros. Discovery said Wednesday that its board determined Paramount’s offer is not in the best interests of the company or its shareholders. It again recommended shareholders support the Netflix deal.
Late last month Paramount announced an “irrevocable personal guarantee” from Oracle founder Larry Ellison — who is the father of Paramount CEO David Ellison — to back $40.4 billion in equity financing for the company’s offer. Paramount also increased its promised payout to shareholders to $5.8 billion if the deal is blocked by regulators, matching what Netflix already put on the table.
The battle for Warner and the value of each offer grows complicated because Netflix and Paramount want different things. Netflix’s proposed acquisition includes only Warner’s studio and streaming business, including its legacy TV and movie production arms and platforms like HBO Max. But Paramount wants the entire company — which, beyond studio and streaming, includes networks like CNN and Discovery.
If Netflix is successful, Warner’s news and cable operations would be spun off into their own company, under a previously-announced separation.
A merger with either company will attract tremendous antitrust scrutiny. Due to its size and potential impact, it will almost certainly trigger a review by the U.S. Justice Department, which could sue to block the transaction or request changes. Other countries and regulators overseas may also challenge the merger.
Paramount Skydance will begin mass layoffs the week of October 27, eliminating around 2,000 U.S. jobs as part of a $2 billion cost-cutting plan under new CEO David Ellison, Variety reported on Saturday.
The layoffs follow the $8.4 billion merger between Skydance Media and Paramount Global, which closed in August.
Additional international job cuts are expected, with the company aiming to disclose full details in its third quarter earnings report on November 10, the report added.
Variety had reported on August 22 that Paramount was looking to cut between 2,000 and 3,000 jobs by early November.
An Inc.com Featured Presentation
As of December 2024, Paramount had nearly 18,600 full- and part-time employees, and 3,500 project-based staff.
Paramount Skydance did not immediately respond to a Reuters request for comment. Reuters could not immediately verify the report.
Reporting by Rajveer Singh Pardesi in Bengaluru; Editing by Jan Harvey and Marguerita Choy
Shareholders of ICICI Securities have, on March 27, approved the proposal for the company’s merger with parent ICICI Bank. However, a majority of retail shareholders voted against the proposal.
The result showed that 71.89 per cent of shareholders voted for the delisting. While 83.8 per cent of institutional investors voted in favour of the delisting, only 32 per cent of non-institutional retail shareholders favoured it.
For the delisting and merger of a subsidiary with its holding company, regulations mandate at least two-third votes in favour of the proposal.
As per the proposed agreement, every 100 shares of ICICI Securities will fetch 67 shares of ICICI Bank. Following the merger, ICICI Securities will become a wholly-owned subsidiary of ICICI Bank, which currently holds 75 per cent stake.
Foreign and domestic institutional investors account for 16.68 per cent of ICICI Securities’ share capital, while non-institutional public shareholders hold 8.55 per cent stake, as of December 2023.
The go-ahead comes amid complaints by retail shareholders that ICICI Bank employees were allegedly ‘canvassing’ incessantly for their votes on social media, besides using repeated calls and messages to “influence the voting decision”.
‘Loss for minority shareholders’
In a recent note, Quantum Mutual Fund — a shareholder in both ICICI Securities and ICICI Bank —had said it would vote against the delisting as the swap ratio was detrimental to the interests of minority shareholders. It estimated the loss for unit holders across two schemes at ₹6.08 crore.
“The current swap ratio values ICICI Securities at a 30-77 per cent discount to its other listed peers based on consensus earnings forecast for fiscal year ending March 2024,” the fund house had said, adding that, with the IPO price as benchmark, the share swap ratio would have been 1.9 shares of ICICI Bank for every share of ICICI Securities, at a premium of 183 per cent to the current offer.
Reacting to the shareholder approval, shares of ICICI Securities fell over 3 per cent in early trade today at ₹719.20. On March 27, the stock had closed at ₹741.70.
Shares of ICICI Securities listed on April 4, 2018, at ₹432, at a 17 per cent discount to the IPO price of ₹520. A reverse merger at that time would have entailed a swap ratio of 1.65 ICICI Bank shares for every share of ICICI securities, at a premium of 146 per cent to the current offer.
Matt is joined by Bloomberg’s Lucas Shaw to discuss Peacock’s strong start to 2024 and the prospect of a possible joint venture or “commercial partnership” with Paramount+, as reported by The Wall Street Journal late last week. They run through the logistics of a merger, the curious timing of the Journal’s story, the critical role live sports rights play, Warren Buffett’s sale of a third of his stake in Paramount Global, and who is most to blame for Paramount’s struggles. Matt finishes the show with a prediction about John Oliver’s HBO show, Last Week Tonight.
For a 20 percent discount on Matt’s Hollywood insider newsletter, What I’m Hearing …, click here.
U.S. Bank invested in digital capabilities within its payments business during the third quarter of 2023 as it shifted toward a more tech-led revenue approach. Tech spend at the $668 billion bank was up 20% year over year to $511 million, according to the bank’s Q3 earnings presentation. “Within payments services, we continue to invest […]
The merger of parent HDFC with HDFC Bank will allow the larger merged entity invest more in infrastructure and mortgage projects, MD and CEO Sashidhar Jagdishan said in the bank’s annual report for FY23.
He said, “A bigger balance sheet post-merger will enable HDFC Bank to take a larger exposure in infrastructure projects. This means we can participate more meaningfully in India’s growth story and contribute to nation-building. In light of all this, the pace at which we aim to grow – we could be creating a new HDFC Bank every 4 years”.
Saying that the merger perhaps could not have been timed better, Jagdishan said that the emotion linked to home buying gets transferred to the home loan service provider and helps build lifelong bonds with customers. Further, only 2 per cent of HDFC Bank’s customers currently source their loans from the bank while 5 per cent take it from other institutions, which in “itself is a huge opportunity”.
HDFC Bank will build these customer relationships by offering a bouquet of the bank’s and subsidiaries’ products and services across saving and current accounts, personal loans, insurance, investments and home loans.
“A compelling value proposition to the customer, that probably does not exist in the market at the scale at which this is envisaged. Going forward this is clearly going to be a game changer,” he said.
Growth engines for the bank will be corporate banking, commercial (MSME) and rural banking, government and institutional business, wealth management, and retail assets and payments, Jagdishan said, adding that the bank is currently the largest SME bank in the country.
Digital transformation
Focus will be on digital transformation through new platforms and customer experiences, and more efficiency by reinforcing core technologies with enhanced performance and resilience at scale.
While the bank has seen a significant improvement in resilience and uptime (basis both internal and external public sources) metrics, it is “not perfect”, Jagdishan said, adding that the bank will continue to strengthen its core IT infrastructure.
In the last few years, HDFC Bank has often faced flak for it customer-servicing technology issues and frequent tech outages, prompting RBI to temporarily bar the bank from issuing new credit cards and launching digital products in FY21. The curbs on credit cards were lifted eight months later and those on new digital launches over a year later.
“This journey has to be accelerated every year. More remains to be done and I am fully committed to improving our customer centricity further,” he said.
The bank will look to add 1,500-2,000 branches in FY24, of which 675 will be in semi-urban and rural (SURU) locations. In FY23, the bank added a record 1,479 branches, a majority of which were SURU branches.
With the mega-merger of HDFC Limited and HDFC Bank taking shape from July 1, the top management is in a huddle to reshuffle some of the key portfolios at the bank. Simultaneously, work is on with respect to board appointments at the subsidiaries which have recently been brought under HDFC Bank’s fold due to the merger.
Rejig in retail businesses
Sources in the know indicate that Aravind Kapil — the group head of retail assets at the bank — may take over the retail mortgages business of HDFC Limited; while the wholesale or the infrastructure portfolio of the erstwhile mortgager may come under Deputy Managing Director Kaizad Bharucha’s watch. “The teams which were reporting to the respective business head and ultimately to Keki Mistry, CEO of HDFC Limited, will report to the new heads at HDFC Bank,” said a person familiar with the development.
The official communication regarding the rejig in portfolios is expected to be announced in a week or so. Email sent to HDFC Bank remained unanswered till press time.
With over ₹5-lakh crore of retail mortgages getting added to the bank, it is gathered there could be more portfolio reallocations especially in the retail business of the bank.
Board nominations for subsidiaries
As for appointing directors as representatives of at the bank across various subsidiaries, with the critical ones identified as HDFC Life Insurance Company, HDFC Asset Management Company and HDFC ERGO, internal discussions are currently underway.
According to sources, Bharucha, the bank’s CFO S Vaidyanathan, and a few other business heads including Rakesh Singh, Group Head-investment banking and private banking, are being considered for inclusion in the boards. Bharucha is expected to join the board of HDFC Life, while Kapil or Singh may be considered for nomination at HDFC ERGO. As for HDFC AMC, Vaidyanathan and Bharucha are seen as the critical contenders.
Clarity on board appointments is expected to emerge in a few weeks once the internal portfolio rejigs at HDFC Bank concludes.
Also given that board positions at the subsidiaries of HDFC Bank have to be filled in post the merger, nominations for that are also underway.
It’s a two-horse race for IDBI Bank between Kotak Mahindra Bank and Prem Watsa-led Fairfax India Holdings, with both parties willing to pay a premium for acquiring a controlling stake. However, neither wants to merge IDBI Bank with their respective banks at this juncture.
“A reasonable share of the government holding may remain in IDBI Bank for at least 2-3 years post the sale,” said a source explaining why the two bidders want to retain their existing banking entities independent of IDBI Bank.
That said, highly placed sources say both interested investors are willing to shell out the premium expected by the government to acquire a majority stake in the bank.
At around ₹57,000 crore of market capitalisation, IDBI Bank trades at approximately 1.3x 12-months trailing price to book valuation.
Kotak has proposed a structure whereby IDBI Bank would be held as its associate, with none of Kotak’s key management executives playing any role in the former.
“The boards of IDBI Bank and Kotak Bank will not have overlaps,” said a person familiar with the matter. Once the government’s stake in IDBI Bank reduces, it may be merged with Kotak Bank. “A glide path of 3-5 years has been sought for the merger,” said the source.
Fairfax has approached the RBI to not consider it as a promoter of IDBI Bank. “Fairfax wants to be seen as a large investor in the bank because it doesn’t want to cede control in CSB Bank or merge the two banks in the near term,” said another senior executive who didn’t want to be identified.
As a deal sweetener, sources said: “Fairfax may extend comfort to the Government of India and Life Insurance Corporation of India (LIC) that IDBI Bank will remain a bancassurance partner for all the existing lines of businesses it has with these entities.”
Emails sent to Kotak Mahindra Bank and Fairfax remained unanswered till press time.
Tough call
The exemptions sought by Kotak and Fairfax are contrary to the current regulations. The extant ownership norms do not permit an investor to hold two banks in the capacity of a promoter.
Fairfax is the promoter of CSB Bank holding a 49.72 per cent stake. Likewise, a bank cannot invest in another bank, though an exception was made in March 2020 when the State Bank of India invested a 49 per cent stake in YES Bank.
Copyright 2018 The Associated Press. All rights reserved.
While nothing is certain, Bollinger Shipyards is expected to announce Monday morning that it is assuming ownership of Halter Marine, a troubled Gulf Coast shipbuilder. Bollinger executives, contacted Friday, did not comment, but offered to arrange an informational interview on any business changes on Monday, in advance of any formal announcement. But, after learning Bollinger Shipyards discussed the matter with at least one other media outlet before the Monday interview, we are publishing what we know, now.
It is no secret that the future of Halter Marine rested on building the Coast Guard’s next fleet of three heavy icebreakers on time and on budget. But with the Pascagoula shipyard struggling to build the 460-foot, 23,000 ton Polar Security Cutters, it was logical that ST Engineering, Halter Marine’s Singapore-based parent company, would seek to distance itself from a what was shaping up to be a catastrophic shipbuilding blowout.
With the rumored deal coming days after U.S. shipping company Matson awarded Halter Marine’s rival, Philly Shipyard, a billion dollar order for three Jones Act containerships, Halter Marine was clearly running out of opportunities to offset a potentially large loss on the Polar Security Cutter program.
Halter Marine’s U.S. government customers were reluctant to comment “on record” regarding the impending change in shipyard ownership. Contacted on Thursday, the Coast Guard referred all questions to the U.S. Navy. Tiara Robinson, a public affairs specialist with the Naval Sea Systems Command, offered a terse Friday afternoon email, snapping that “The Navy does not comment on the internal workings of private businesses.”
VT Halter had a tough time with the USNS Howard O. Lorenzen a complex Missile Range Instrumentation … [+] Ship.
U.S. Military Sealift Command
A Good Time To Exit:
it is obvious that Halter Marine’s parent company, ST Engineering, has been positioning itself to put Halter Marine on the market for some time.
The Singapore-based company, which did not respond to emails, likely recognized the risk wrapped up in Halter Marine was too much for ST Engineering to absorb. The contract for the first Polar Security Cutter is a lean-and-mean $745.9 million fixed price, incentive-firm arrangement. In total, the shipyard was set to get about $1.94 billion if the Coast Guard exercised all three options. That sounds good, but it’s a very, very low-priced bid, and, to profit, the shipyard had to perform perfectly.
Halter Marine wasn’t getting it done.
Given the contract’s structure, Halter Marine—and ST Engineering—had a lot to lose if the shipyard was unable to meet the price target. With a fixed price target, even a modest 10% overage on a $2 billion construction contract is a tough pill to swallow for any parent company, no matter how big.
After more than three years of work, ST Engineering has a pretty good idea of how the program was shaping up, and likely decided that a head for the exits was prudent.
A timely exit, before the Polar Security Cutter program implodes, makes a smart diplomatic move. ST Engineering is a state-owned enterprise. With Singapore’s state holding company, Temasek Holdings, owning just over 50% of ST Engineering’s stock, big problems with a high-profile U.S. military shipbuilding project could easily spill over into the tough geopolitics of Southeast Asia.
Though Halter Marine is nominally insulated from foreign influence, a wholesale collapse of America’s premier polar icebreaker program could well lead to some potentially uncomfortable examinations into Chinese Communist Party influence upon Singapore. China does not want America in any position to engage at either the North or South Poles, and snarling a major icebreaker recapitalization in the production phase offers a logical, neat, and cost-effective means to constrain American influence. A timely divestment offers a chance for a U.S.-owned company take outright control over what is an important naval shipyard.
If a deal is on offer, VT Halter may not be the first of ST Engineering’s marine property to be put on the market. ST Engineering may well be setting the stage to exit shipbuilding altogether. While a targeted divestment of Halter Marine makes certain business sense, an outright divestment of ST Engineering’s entire maritime sector—two shipyards in Pascagoula and two shipyards in Singapore—is not out of the question.
Shipbuilding is, at best, a low-margin revenue generator that, in diversified conglomerates, often struggles to compete against flashier, higher-margin product offerings. Over the past two years, ST Engineering’s maritime sector has been de-emphasized companywide. ST Engineering has gradually downgraded the largely independent marine business sector, folding it into a new and diverse “Defense and Public Security” line of business. It is a poor fit. ST Engineering’s marine businesses do a large amount of civilian work, which can be something of an irritation in a defense-focused business.
The PSC Broke A Shipyard Before Breaking Any Ice
To industry observers, it is obvious the Polar Security Cutter was breaking Halter Marine. To outsiders, the Polar Security Cutter program might seem relatively healthy, and a great boon to any shipyard holding the contract. The program has great top-cover in Washington, with both the White House and Congress eager to fund the new ships. In the Service, the program is a major, eagerly-awaited priority. And Admiral Linda Fagan, the current Coast Guard Commandant, as one of the few high-ranking Coast Guard officers with first-hand experience aboard heavy icebreakers, seems well-positioned to push the program towards a successful completion.
But the program, awarded back in 2019, is not doing well. After slipping two years from a hoped-for “accelerated” 2023 delivery, the Coast Guard now appears to lack confidence that the icebreaker will arrive even by 2025. In early 2022, Coast Guard leadership expected Halter Marine to start cutting steel this year, but, with less than two months left in 2022, the shipyard shows no sign of getting started. To mitigate the risk of further delay, the Department of Homeland Security is already enacting a contingency plan and asking Congress for funding to purchase one of the few commercially available polar icebreakers able to serve in the Coast Guard fleet.
Even worse, the prospects that the Government might help defray risk by other means is quite limited. The European factory building the engines used to power the big cutter is set to decommission after the third Polar Security Cutter power plant rolls off the production line, making the odds of an easy follow-on order rather limited.
At the shipyard, few of the leaders who crafted Halter Marine’s original bid are still with the company. While many have been replaced with competent people who have a strong record of delivering for the Coast Guard, a wholesale pruning of the yard’s executive and engineering leadership—folks who were “instrumental in supporting the company’s winning bid”—indicates that ST Engineering had little confidence in the original proposal or the original contract terms.
As I warned in 2019, Halter Marine has a long-held tendency to lurch between cycles of boom and bust—underbidding when desperate, and then collapsing under the workload. A new ownership team, experienced at managing boom-bust cycles, may prove helpful
If Halter Marine offered too optimistic a bid, the Polar Security Cutter has likely proven better at breaking a shipyard than it will be at breaking ice.
Edison Chouest Offshore operates the M/V Aiviq, a good foundation.for building expertise in … [+] supporting U.S. Polar operations.
Safe Marine Management
Time To Enter?
Few companies are eager to take on a troubled shipyard and assume a risky government contract.
It doesn’t happen often. But when it does happen, the government customer can seize the opportunity to renegotiate the contract, resetting a problematic program. In 2021, Bollinger Shipyards bought the builder of the Navajo-Class (T-ATS) towing, salvage and rescue ship, Gulf Island Shipyard, only to see the Navy shift the bulk of the program to rival shipbuilder, Austal USA. And while that may seem cruel, the Navy did give Bollinger breathing space to fix the yard, and, potentially, compete for more T-ATS hulls later.
Something similar could happen at Halter Marine. Anyone who does take on the effort of purchasing a troubled shipyard faces a grueling effort of recalibrating staff, reorganizing programs and troubleshooting, and the Coast Guard might well jump at the opportunity for a fresh start. And while the Department of Homeland Security is unlikely to cancel the Polar Security Cutter outright, the Coast Guard certainly could “re-baseline” the contract and offer a new buyer a programmatic clean slate.
A new owner at Halter Marine could shape the outcome of the T-AGOS ocean surveillance ship contract. Halter Marine has a long record of building complex surveillance ships, The yard built the current T-AGOS fleet-a critical type of ship used to track submarines. The U.S Navy has delayed the expected issuance of the seven-ship T-AGOS contract award, and, with new ownership at Halter Marine, the Navy may revisit the contract, and shape it to give any new owner of the Halter Marine yard extra breathing room.
Any new owner of Halter Marine has their work cut out for them. Not only must the new owner get the Polar Security Cutter back on track, but the new owner needs to break from Halter Marine’s boom-bust business cycle. It also needs to sustain the yard’s ongoing effort to improve the yard’s once-ugly safety record, and build a stronger workforce—a workforce that is likely highly populated with castoffs from large Huntington Ingalls shipyard, just a few short blocks away.
The new owner, if it can straighten out the existing shipyard and stabilize the ongoing projects in the yard, has a real opportunity to make a play for wider government business, either by supporting the Navy as a second yard for the Constellation Frigate (FFG-62) program, or as a yard helping out on submarine fabrication.
If Bollinger Shipyards—partially owned by the family that operates Edison Chouest Offshore—does take over Halter Marine on Monday, there a a lot of opportunities to spread work around, and continue making the two privately-held companies into a real force in Gulf Coast shipbuilding. Both Chouest and Bollinger have a history of taking over troubled yards, repurposing and reinvigorating them. With both Bollinger and Chouest directly operating some 15 U.S. based shipyards between them, the opportunities for interesting operational synergies are enormous. Parts of the Polar Security Cutter could be built at various locations, and workers could be leveraged to help stabilize the destructive “boom-bust” cycle Halter Marine struggled to overcome.
If other parts of the SE Engineering Marine infrastructure are in play, the deal could end up opening interesting opportunities to explore business in the busy waters of Southeast Asia.
In addition to managing dispersed shipyards, both Bollinger and Chouest have an opportunity to support the Coast Guard’s work at the Poles. Bollinger, of course, already has a long relationship with the Coast Guard, and is preparing to close out the Fast Response Cutter production line. Edison Chouest Offshore, as owner/operator of one of the few U.S. built heavy icebreakers—the M/V Aiviq—would be set to take on the job of becoming America’s polar operations specialist—providing vessels, contract support or harbor operations. Both yards would also be well positioned to take on the job of building the next generation of smaller Coast Guard icebreakers, advancing the Coast Guard’s growing book of work in both the North and South Poles.
If the deal goes through—as expected—there are plenty of opportunities to unlock real profits in the Halter Marine yard. It just depends on how hungry Bollinger and Chouset might be for a tough new challenge—and on just how eager ST Engineering is to avoid one.
Pegged to be the metal for nation-building, stainless steel is being increasingly used in architecture, building and construction activities, automobiles, railways and transport in India and globally. Yet, the recently imposed export duty of 15 per cent on steel is dampening the business operability. Abhyuday Jindal, Managing Director, Jindal Stainless, in an exclusive conversation with BT’s Nidhi Singal talks about the company’s strategy, its upcoming merger, expansion plans, and much more. Edited experts:
BT: Jindal Stainless reported an 8 per cent year-on-year growth in its consolidated profit for the April-June quarter, despite rising input costs and export duties. What was the strategy that worked for the company?
Abhyuday Jindal: The last quarter was actually quite a challenging quarter because there were two-three external factors that are coming into effect now. First, the commodity cycle was on a downward trend. All your raw material prices were falling. So when that starts, the whole economy, and the world, go into kind of destocking mode. There is pressure to sell volumes, there is pressure on margins. At this time, our government came up with this 15 per cent export duty. So, it is actually a double whammy for companies like us. Prices any way were coming down, plus with this export duty coming, it became unviable or very challenging for Indian companies to export. Companies like us, where there is not so much demand in stainless steel (that we are trying to create), we were dependent on the export market. There are certain sizes that we have or certain equipment we created, which are created only for the export segment. That was a big negative impact on us because of that kind of volume we then had to push to domestic. One positive thing for our company is that we are very agile. We are not dependent on any industry or any segment more than 15-20 per cent. Just to give an example, last two years, the auto was severely impacted because of semiconductors. And auto is a big sector for us, but our volumes were not impacted at all because whatever shortfall was in auto, we were very easily able to push that into other sectors. (As) railway picked up, so we pushed it into railways.
The infrastructure segment has picked up with all the support coming from the government. The same thing we are doing now is that with this export duty coming on, we are not able to export the volumes that we were (doing earlier). So, we have pushed our volumes into the sector in that we were not very aggressive. We were leaving that more for the Indian secondary stainless steel players and the smaller company. But with the export market not available to us, we have entered into this segment. There was a little dip as compared to Q4 last year, but overall we were able to maintain the volumes. Margins are definitely impacted by this export duty coming in because everybody is then buying only for the domestic market. And I think that was the impact the government wanted, which has been created. So, we are hopeful that next couple of months, they should do away with this export duty. The other factor is that now steel players can add boron, which classifies them as alloy steel, and then they are able to export without export duties. But in stainless steel, that is not possible. We are into process industries also: petrochemical, nuclear, auto, and railways. Architecture Building Constructions (ABC) is a massive area where stainless steel is consumed, and the world showcases that. And anywhere you see stainless steel is the material that is consumed in infrastructure to a maximum. So, in the same way, India is also leading up to that. A lot of interesting areas, like railway foot-over bridges, are now completely into stainless steel. In all coastal areas, they are supposed to be made of stainless steel. So that way, we are able to manage our Q1 performance.
BT: What percentage of your business was coming from domestic and export? AJ: To serve domestic customers in one passion and export in a strategic manner aligned with the ‘local to global vision. Pre-pandemic, our export share has been 20-25 per cent. During the pandemic, it increased to about 30 per cent. However, post exports duty imposition it is low at 10 per cent only. When this export duty goes down, we hope to take up our export percentage (back) higher again.
BT: When you divert your production to other sectors, how easy or difficult is it to switch manufacturing?
AJ: There are standard grades, and there are customised grades. And when we say we can switch, we can switch in the series also. Last full year, the 300 series was the major series for us. Almost 50 to 60 per cent of our sales were in the 300 series. That was also because the export market is more on the 300 series. So then, because export was high, the 300 series was high. Now that export duties have (been) put in, the 300 series has come down by about 10 to 15 per cent. But we’ve picked up 400 series and 200 series, which go into other sectors and segments. So that way, we are able to move very fast into other industries and streams. (The switch can happen) within, I would say, 20 to 25 days. We can very easily switch because it is purely (about) getting the required raw material. Nothing else needs to be done. If the raw material is with us, we can switch instantly. But if raw material has to be organised, then it can take about 20-25 days. The equipment, processing techniques – everything is the same. It is only the grade that we need to switch.
BT: How will the merger with Jindal Stainless (Hisar) Ltd impact your operations?
AJ: Jindal Stainless (Hisar) Ltd. was demerged in 2014. The reason was that we were in corporate debt restructuring. Along with our committee of bankers and our team internally, one way to protect our organization was decided. We had two factories, one in Hisar, and one in Orissa. Splitting them into two listed companies was a good option. Hisar, in the history of the Jindal Group, has never been at loss. For almost 50 years, Hisar has continuously been making profits. However, at that time, the stainless steel industry went through a very tough time. The point of view was that let us protect one company during those trying times. Today, the biggest reason that the domestic stainless steel industry is suffering is unwarranted imports — heavy dumping that happens from China and Indonesia. Over the course of the last 10 years, due to excessive dumping, the whole industry and our margins and volumes were always under pressure. In 2014-15, the companies decided to split. (Today) I would say we are the only company in the whole manufacturing sector that successfully did the splitting of companies and successfully got out of CDR. 2019 is when we completely paid all the debt, did not take any haircuts, and got out of CDR. Over the last couple of years, we have reduced our debt significantly, and our ratios are now one of the best in the metal sector. So now we felt it was the right time to remerge the companies.
This was also from the perspective of having one standalone entity that is a global major in stainless steel. After the merger, we will be among the top 10 stainless steel producers in the world. And after our expansion, which will start in January of this financial year, we aim to be in the top 5 in the world.
The merger will have a lot of benefits, including an improved balance sheet and stakeholder benefits. Our negotiating power will increase because rather than negotiating with our vendors and suppliers as two separate entities, we will now negotiate as one. It will also help in improving our customer service. Our investors will benefit too. There was always confusion in the market – what does Hisar do, or what does Jajpur (Orissa) do? Because of having two legal entities, we had to make a lot of double investments – warehousing, logistics, etc. Now, we’d be able to do away with all this.
BT: Where does India stand in the stainless steel ecosystem globally?
AJ: Till last year, we were actually number two in terms of production in stainless steel. China is number one, always, and then India was number two. Then certain factors happened – anti-dumping duty and CVD on stainless steel for imports coming in from China and Indonesia were removed. As soon as that got removed, Indonesia picked up its production and now has overtaken India as number two in terms of the stainless steel ecosystem. So it’s China number one, India used to be number two last year, and then Indonesia. Now it’s China, Indonesia, and India. So because of the government policies and because of the factors that have impacted us, India’s position is falling, which is a very big negative, I can say it from the government’s point of view.
BT: So aren’t the new export duties going to further damage India’s position in the stainless steel leatherboard? AJ: Definitely, because now everybody, after the two years and the momentum that we saw in the industrial activity, every company has announced expansion, adding capacities and making India further strengthen its position. But with this duty and depending on how long it will continue, everybody is now either questioning that expansion or delaying it further. I mean everything is under question because of this export duty. We do feel that it should not stay for long, but all our plans are under, I would say, fix right now.
BT: But on the other side, isn’t the government really pushing every sector with the PLI? AJ: The government is reworking the steel PLI. Nobody has been able to really apply or get anything from the steel PLI. The focus for PLI has been importing substitution, but I feel that the interaction with the industry requires being more robust. That is reason, why they are reworking on it, because every company from the steel industry represented that there is nothing in this that we can actually apply for or we can actually go and get this PLI for us. This is why, from the information that I’m getting now, they are reworking it and coming out with a new PLI for the steel industry.
BT: Stainless steel is created using scrap. So, where do you source your raw material from? AJ: Stainless steel is the most sustainable material because it is 100 per cent recyclable and contributes to a circular economy. We use more than 85 per cent of scrap in one production. For this reason, we are completely focused on scrap (which is also a global phenomenon). We source our scrap from all over. It is mainly domestic and nearby countries. South East Asia, Middle-East, and India contribute to 70-75 per cent of our scrap consumption. The remaining 20-25 per cent comes from the US and Europe.
BT: How much of it is coming from India? And do you see this growing? AJ: India, you can say, is almost 45 per cent. And yes, especially with government – the kinds of policies that they coming out with are helping and supporting this. Now they are coming up with the National Scrap Recycling policy, which will definitely help in terms of getting more scrap available to the Indian ecosystem.
BT: Even though you don’t use coke for melting, your process of sourcing the scrap (raw material) is heavy on carbon emissions. What initiatives have you taken to reduce your carbon footprint? AJ: Manufacturing through the scrap route is relatively low on carbon emission. We (have) already announced that we are not going to be investing in any more thermal power plants. We are setting up and investing in almost 300 megawatts of renewable capacity in Odisha, Harayana, and Rajasthan. We are also going to commission a green hydrogen project in Hisar that will enable the company to reduce its carbon dioxide emissions by nearly 2,700 metric tonnes per annum. We have also looped in EY India for charting out a dynamic plan to achieve our ESG and decarbonisation goals. For all our expansion, we require a lot of energy that will all be met through renewable sources.
The Kroger-Albertsons link-up would yield some surprising winners. (Photo by Frederic J. BROWN / AFP) (Photo by FREDERIC J. BROWN/AFP via Getty Images)
AFP via Getty Images
Kroger’s plan to buy rival grocer Albertsons for $24.6 billion would be a relief for Cerberus Capital Management.
The private equity firm, headed by former Trump advisor Stephen Feinberg, has been looking for an exit from its Albertsons investment almost since it first put its money in back in 2006.
A back-of-the-envelope calculation shows that Cerberus, which owns about 29% of Albertsons stock, could collect in the neighborhood of $7.1 billion from the sale before factoring in the assumption of debt and reductions for a possible sale of existing stores. That’s assuming regulators approve the merger.
Cerberus wouldn’t be the only big winner in the deal.
Albertsons’ executive team would reap a combined payout of about $97 million, according to the grocer’s most recent annual proxy statement. That value is connected to the company’s stock price and outstanding equity awards as of January 26.
More than half of that windfall would go to Chief Executive Officer Vivek Sankaran. Sankaran, who rose to the top of the organizational chart in September 2021, stands to collect $50 million.
Merger between TCI and CDS will help ensure continued success and exceptional service to the Automotive Parts Distribution Industry.
Press Release –
updated: Jul 8, 2022
LOS ANGELES, July 7, 2022 (Newswire.com)
– TCI Dedicated Transportation Companies (TCI) and Command Delivery Systems, Inc. (CDS) have merged to unite their transportation businesses. This union enables both companies to fully align their efforts with their mutual goal of ensuring future success and exceptional service for the Automotive Parts Distribution industry. Work will continue to be conducted under the brand of Command Delivery Systems (CDS), but TCI Environmental Services, Inc. will be the legal entity.
For more than 30 years, CDS has served the automotive industry by transporting new car replacement parts from manufacturers to dealers in California, Arizona, Nevada, and Utah. Since 1978, TCI Transportation has provided a variety of services and now consists of a large network of partners and customers across the U.S. Given that CDS is an expert in the pickup and delivery of parts and TCI is a leader in all facets of the trucking industry, this merger comes naturally.
The leadership team overseeing this transition brings a combined 65 years of experience to the table. Members of the team from CDS include Founder and President Greg Selmanson, and Director of Operations Juan Martinez, and from TCI include Co-Presidents Andrew Flynn and Ryan Flynn. As a result of their complementary strengths, both companies expect many opportunities to emerge from this union.
“The synergies between our organizations are tremendous,” said Ryan Flynn. “CDS brings excellence in auto parts consolidation and distribution. TCI brings world-class safety, maintenance, recruiting and back office support. Combining the strengths of both companies will help extend our auto parts distribution services to additional shippers while expanding our footprint into more of the regions TCI currently operates in.”
With CDS being the newest addition to TCI Environmental Services, it will continue working to develop a broader transportation network while maintaining a focus on its employees and the community at large. The plans for expansion will not only create more jobs, but existing employees will enjoy ongoing training and future growth opportunities as well. In addition to developing new strategies for growth, CDS will be continuing investment in new and innovative equipment, including alternative fuel vehicles. Both TCI and CDS are also looking to add new locations and offer additional transportation services to their respective customers.
“I want to thank the many dedicated CDS employees for their years of hard work and commitment,” said Greg Selmanson. “I couldn’t be prouder of the culture we’ve built or the service we’ve consistently provided to our customers. I’m looking forward to the opportunity to continue to grow the business with Andrew and Ryan Flynn.”
During a time when industries are experiencing shortages and perpetual changes, the merger of successful companies like TCI and CDS is a shining example of the many opportunities still available. As these teams continue to keep their shared values central to their work and maintain their strong commitment to stakeholders, customers, and employees, this merger helps to demonstrate that sustainable success can be possible when business leaders prioritize the people that keep them operating.
“CDS is a great fit for TCI, and we feel the cultures and service levels will line up perfectly,” said Andrew Flynn. “TCI already operates various dedicated systems and has multiple facilities across the region Command operates in and we look forward to growing the auto parts distribution portion of the business as part of the Command division.”
PHOENIX, March 9, 2018 (Newswire.com)
– Industrial Inspection & Analysis, Inc. (“IIA”) the USA expands its service offerings with the recent acquisition of Diversified Inspections / Independent Testing Laboratories, Inc. (“DI/ITL”) and CraneCare, Inc.
Founded in 1969, DI/ITL is the largest independent, third-party, safety and integrity inspection firms in the country specializing in on-site inspections of vehicle-mounted aerial lifts, digger derricks, fire trucks, airline ground support equipment and live-line tools for a variety of companies, public & private utilities and municipalities.
CraneCare, a sister company based in Albuquerque, NM, was founded in 1996. CraneCare is an all-inclusive overhead and mobile crane service company handling inspections, certifications, load testing, operator training, maintenance, part sales, and installations.
“The acquisitions of DI/ITL and CraneCare immediately establishes IIA as a continental leader in the heavy equipment/lifting equipment inspection industry” explains John Cote, CEO of IIA. “Combined with our recent acquisition of Domson, our reach in this very attractive sector spans the entire U.S. and a good portion of Canada. A key part of the IIA vision is serving a broad range of promising industries and diversifying our geographic presence. We believe that diversifying our industry and geographic exposure results in a steadier business built for the long-term that is better able to handle economic cycles. Our focus will continue to be on the customer, employee training, and investing in our capabilities.”
“We at DI/ITL and CraneCare are very proud to have built the leading platform for aerial lift/crane inspections programs over the past 49 years. I am pleased with all of our accomplishments and the individuals that will continue with IIA,” states Leland Bisbee, President/CEO of DI/ITL and CraneCare. “The combination with IIA will offer our customers expanded NDT capabilities while continuing our joint commitment to the highest level of technical safety and integrity testing our customers have come to expect.”
With over 100 employees including 80 inspectors and technicians covering customers in all 50 states, the acquisition of DI/ITL and CraneCare significantly bolsters IIA’s existing aerial and lifting equipment service business established through the recent acquisition of Domson Engineering in December 2017. This transaction continues IIA’s strategy of building a network of inspection and testing brands that hold a competitive advantage and offer a strong value proposition to a long list of customers in a wide variety of end markets. The addition of DI/ITL and CraneCare is an excellent complement to IIA’s inspection and non-destructive testing brands, which includes US NDI, Fox NDE, and NDT Labs, as well as its engineering and analytical brands, which includes Domson Engineering, TIMCO Engineering, QC Group and Infinium NDE.
About Industrial Inspection & Analysis.
IIA is a high-growth inspection, testing, and analytical business committed to providing Story-Worthy Service and Solutions even through the most challenging situations to customers nationwide and beyond. To learn more about all of the IIA brands, visit industrial-ia.com.
