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Competition Comm clears USD 16 billion Walmart-Flipkart deal

Akhilesh Bhargava



New Delhi  |   The Competition Commission said it has cleared US retail giant Walmart’s proposed acquisition of Flipkart, a deal estimated to be worth USD 16 billion.

The approval comes less than three months after the announcement of the mega-deal, which is also being opposed by various trade organisations.

In May, Walmart announced the acquisition of a 77 percent stake of Flipkart in its biggest takeover till date.

“@CCI_India approves proposed acquisition of Flipkart Private Limited by Wal-Mart International Holdings, Inc,” the regulator said in a tweet.

Mergers and acquisitions beyond a certain threshold require the approval of the Competition Commission of India (CCI).

Welcoming the regulator’s decision, Walmart said it remains committed to contributing to the Indian economy by supporting smallholder farmers, manufacturers, and its Kirana customers.

“Flipkart is a prominent player in India with a strong, entrepreneurial leadership team that is a good cultural fit with Walmart.

“We believe that the combination of Walmart’s global expertise and Flipkart will position us for long-term success and enable us to contribute to the economic growth,” it said.

In a statement, Flipkart Holding welcomed the CCI’s decision. “… by combining Walmart’s global expertise with our leadership position and Indian ethos, we believe we are positioned for long-term success and contribution to the Indian economy and society,” it added.

Traders’ body CAIT, which has been opposed to the deal, described the CCI approval as “most unfortunate” and said it would approach the court against the decision.

In June, more than 100 trader organisations opposed the deal stating it will cause “irreversible damage” to small traders and endanger jobs for thousands.

As per the notice submitted to the CCI, the acquisition of a majority stake in Flipkart will be done through Wal-Mart International Holdings.

The proposed transaction would be effected pursuant to the share purchase agreement and the share issuance and acquisition agreement entered into on May 9 by and among Walmart’s subsidiary and Flipkart, the notice said.

In June, Walmart said that it expects to close the deal this year.

“In May 2018, the company announced it will pay approximately USD 16 billion in exchange for approximately 77 percent of the outstanding shares of Flipkart Group (Flipkart). The investment includes USD 2 billion of new equity funding.

“…closing is expected later this calendar year, and is subject to regulatory approval,” the American retail major had said in a filing to the US Securities and Exchange Commission (SEC).

The US India Strategic Partnership Forum (USISPF) said the deal is good for India as a whole.

The deal will strengthen the agriculture supply chain and create new skilled jobs, supporting the ‘Make in India’ initiative, USISPF President and CEO Mukesh Aghi said in a statement.

Walmart is a USISPF member.


Rupee extends slide, down 7 paise to 71.23 vs USD





Mumbai  The rupee slipped by 7 paise to close at 71.23 against the US dollar on Friday, pressured by heavy foreign capital outflows and firming oil prices.

This is the third straight session of loss for the domestic currency, during which it has depreciated by 53 paise.

On a weekly basis, the rupee registered a loss of 8 paise.

At the Interbank Foreign Exchange (forex) market, the rupee opened lower at 71.22 and fell further to touch the day’s low of 71.44.

The local unit covered some lost ground, before finally ending at 71.23 per dollar, down by 7 paise against its previous close.

On Thursday, the rupee had tumbled 36 paise to close at 71.16 per US dollar.

Forex traders said heavy selling in domestic equities coupled with foreign capital outflows affected the movement of the rupee.

Foreign portfolio investors (FPIs) sold shares worth a net Rs 966.43 crore, while domestic institutional investors (DIIs) bought equities to the tune of Rs 853.25 crore Friday, provisional data showed.

“India’s rupee and sovereign bonds declined owing to the continuous rise in crude prices and sustainable foreign outflow. Domestic equity markets also closed on weak wicket, which also weighed on the rupee,” HDFC Securities’ Head, PCG and Capital Markets Strategy, V K Sharma said.

Sharma further said the rising dollar index also weighed on the local unit.

The dollar index, which gauges the greenback’s strength against a basket of six currencies, rose 0.11 per cent to 97.08.

Meanwhile, brent crude, the global oil benchmark, was trading higher at USD 65.01 per barrel, up by 0.68 per cent.

Benchmark equity indices reeled under selling pressure for the seventh straight session Friday. The 30-share BSE Sensex declined 67.27 points, or 0.19 per cent, to end at 35,808.95. The broader NSE Nifty settled at 10,724.40, down by 21.65 points, or 0.20 per cent.

The Financial Benchmark India Private Ltd (FBIL) set the reference rate for the rupee/dollar at 71.2515 and for rupee/euro at 80.4168. The reference rate for rupee/British pound was fixed at 91.2261 and for rupee/100 Japanese yen at 64.55.

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Indian cities among top 5 fastest growing office rental markets globally?

Ali Azar



One of the world’s biggest real estate consultants – Knight Frank, has just released their Global Outlook 2019 report, which evaluates 33 cities across the globe and gives an insight on expected office rental growth for 2019 among other things.

Leading the pack for growth of prime office rental markets in the world are Australian heavyweights Melbourne and Sydney, with growth in office rentals expected to touch 10.1% and 8.6% in 2019 on the back of tight supply due to employment growth and relatively low levels of real estate development in recent years.

Indian cities took up two out of top five spots for the fastest growing office markets globally. Bengaluru and New Delhi have emerged among the top five in the world taking up position 3 and 4 respectively, thereby beating Asian giants such as Hong Kong and Singapore as per the report by Knight Frank.

Bengaluru, which saw a prime rental value of ₹ 125 per square foot per month in 2018, is expected to see a growth in rents in the range of 6.6% in 2019, due to the buoyant Information Technology and Start-up sector and lack of quality Grade A space supply. Mirroring the same trend, New Delhi with prime rental values of ₹ 326 per square foot per month is expected to see a rise of approximately 6.5% in 2019 on the back of constricted fresh supply.

In comparison, Mumbai’s prime office rentals, which stands at around ₹ 300  per square foot per month will experience a subdued growth of just 0.3% in 2019 and features nowhere in the list. Rounding up the top 7 globally after Melbourne, Sydney, Bengaluru and New Delhi are Boston, Amsterdam and Berlin.

Across the globe, uncertainty surrounding trade tensions and political events has led to a pause in developments, thereby causing vacancy rates and driving rental growth up worldwide.

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Rupee gains 26 paise against US dollar in opening trade





Mumbai | The rupee appreciated by another 26 paise to 70.44 against the US dollar in opening trade on Wednesday after retail inflation fell to a 19-month low of 2.05 percent in January.

The weakness in the dollar against some currencies overseas as investors shifted their focus to riskier asset amid the US-China trade truce hopes, also supported the rupee’s upmove.

Besides, retail inflation falling to a 19-month low of 2.05 percent in January over the previous month, and selling of the American currency by exporters supported the rupee, forex dealers said.

Industrial output growth remained subdued at 2.4 percent in December 2018 on account of contraction in the mining segment and poor show by the manufacturing sector.

The rupee had gained 48 paise to end at a one-month high of 70.70 against the US dollar Tuesday, registering its sixth straight session of gain. In the last six trading sessions, the rupee has gained 110 paise. The benchmark BSE Sensex rose 184.68 points, or 0.51 percent, to trade at 36,338.30.

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