Saudi Aramco in Talks to Acquire up to 25% Stake in Reliance, Jet Plunges Over 31% After Suspension of all Flights, Cred in Talks to Raise $100m, Apple and Google Asked to Take Down TikTok App et al.

Jet plunges over 31% after suspension of all flights. Saudi Aramco in talks to acquire up to 25% stake in Reliance Industries’ refining and petrochemicals businesses. Cred in talks to raise $100m. Apple and Google asked to take down TikTok app. Pinterest prices IPO at $19 per share.

 

Moving on to the top Business stories of the week.

 

 AVIATION 

Jet plunges over 31% after suspension of all flights.

 

Nose-Dive: Jet stock plunged over 31% as the domestic carrier temporarily suspended all flights with no cash to run operations any further. 

 
However, the lenders said that they are reasonably hopeful of a successful bidding process for stake sale.
 

No Rescue: The bids received for Jet Airways will be opened on May 10. However, if none of them are accepted by the lenders, then the airline will be taken through bankruptcy proceedings.

Jet’s fall is a story of the fall of its founder. Read the story of the rise and fall of India’s oldest private airline here.

 

 RELIANCE 

Saudi Aramco in talks to acquire up to 25% stake in Reliance Industries’ refining and petrochemicals businesses. Reliance Retail in talks to buy Hamleys. Jio to buy spectrum from open market. 

 

While Giants Dance: Saudi Aramco, the world’s largest crude oil producer, is in talks to acquire up to a 25% stake in Reliance Industries’ refining and petrochemicals businesses. A minority stake sale could fetch around $10bn-$15bn, valuing the latter at c. $55bn-$60bn. 


Aramco’s interest in Reliance comes after Saudi Arabia’s Crown Prince Mohammed bin Salman’s visit to Delhi in February when he said that he expected investment opportunities worth more than $100bn in India over the next two years.

 

Noah's Ark May Sink: C Banner International, owner of British toy store chain, Hamleys is exploring the possibility of selling the loss-making chain to Mukesh Ambani's Reliance Retail. 
 

The news comes as the 260-yr-old toymaker is facing intense competition from online stores such as Amazon. The acquisition will provide Reliance Reliance will a global footprint.
 

Flashback: Founded in 1760 as a one store shop called Noah’s Ark, Hamleys opened its London flagship store in 1881 and now has 129 outlets across Europe, Asia, the Middle East and Africa. In India, it already has a tie up with Reliance Brands Ltd to open 20 more Hamleys stores.
 

Change in Strategy: Reliance Jio is set to buy spectrum from the open market. 
 

The development comes as Jio terminated its agreement with Reliance Communications to acquire spectrum from it as the Department of Telecommunications refused to approve the deal.
 

Bleeding Heavily With Losses: RIL has an outstanding debt of INR2,87,505cr and it grew by INR69,000cr in FY 2019 because of its investments in Reliance Jio. While the company has cash reserves worth INR133,027cr on its books, the margin from Jio is not enough to recover these investments in the near future, as per analysts. 

RIL is estimated to have invested around INR3L cr in Reliance Jio so far and another INR1 lakh crore to expand petrochemicals business in Jamnagar. Read more on how Reliance plans to manage its rising debt here.

Busy as a Bee: The last financial year has been the busiest for Reliance’s M&A team in over a decade as the company divested from some core segments and invested in consumer-facing ones. Reliance reportedly dealt with 33 M&As, investment and joint ventures in the last financial year, valued at $2.9bn. More on these deals here.

 

 STARTUPS 

Cred in talks to raise $100m. CureFit to raise $75m as part of Series D funding round. 

 

Pouring In: Financial technology platform Cred is in talks with China’s Hillhouse Capital and some of its existing investors including Sequoia Capital to raise $100m.
 

 

The deal, if it goes through, will likely value the six-month-old platform at $400m, a substantial raise from $75m when it first raised capital last year.
 

Frontrunner: Existing shareholder Sequoia Capital is expected to lead the funding round, with Yuri Milner-backed Apoletto Asia and Ribbit Capital also doubling down. 

  

Pump It Up: Health and fitness startup Cure Fit Healthcare is close to raising $75m in a funding round led by existing investors Accel Growth and Chiratae Ventures, which would value the startup at $500m. 
 

This financing could be part of a larger Series D round of $125m-$150m expected to be raised later this year.
 

The development comes three days after the startup announced that it has acquired cold-pressed juice brand Rejoov. CureFit’s other acquisitions in the past include boutique fitness brands Cult and The Tribe, yoga chain a1000yoga as well as Bengaluru-based Kristys Kitchen.
 

Expanding Boundaries: The company also plans to launch health clinics and expand overseas, besides entering another 10 Indian cities with its food and fitness centres. 

 

 CONTENT 

Hotstar crosses 300m users. Netflix announces 10 new original films to expand its India-specific content. Amazon plans to launch free ad-supported music streaming service.

By Leaps and Bounds: Accounting for over 40% of all long-form digital content consumed in India presently, Disney-owned Hotstar has crossed 300 million monthly active users (MAUs) within four years since its inception - a 4x growth since 2017-end when the platform had about 75 million MAUs.

Custom Made for India: Netflix has partnered with top filmmakers and producers like Ronnie Screwvala’s RSVP, Shah Rukh Khan's Red Chillies Entertainment, Karan Johar's digital content arm Dharmatic, Siddharth Roy Kapur's Roy Kapur Films et al to release 10 new original films by the end of 2020.

Game On: Amazon is reportedly in talks with major music labels to provide ad-supported music streaming service that would offer a limited catalog of songs to take on rivals such as Spotify and Apple Music. 

The service would be made available through its Alexa voice assistant on the company's Echo line of devices.

 

 TECH 

Apple and Google asked to take down TikTok app. Pinterest prices IPO at $19 per share.
 

Shutting Down...: The Indian government has asked Google and Apple to take down popular Chinese short-video mobile application TikTok from their app stores.
 

The move comes a day after the Supreme Court refused to stay an earlier order by the Madras High Court to ban the app. 
 

The order will help stop further downloads of the application, but people who have already downloaded it will be able to continue using it on their smartphones.
 

Huge Loss: TikTok was the third most installed app globally during Q1 across the App Store and Google Play, according to Sensor Tower, a market analysis firm. Out of the 188 million new users added in the March quarter, India accounted for 88.6 million. India accounted for more than 39% of its 500 million user base.

 

Aiming High: Image sharing platform, Pinterest has priced its initial public offering at $19 a share, above its original proposed price range of $15 to $17 a share.
 

The strong demand for the IPO will perhaps ease investor concerns about the stampede of tech unicorns racing to go public this year after Lyft's somewhat lackluster debut. More on this here.

 

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