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Today's Hot Stories-July 6, 2009

10 Headlines for Today

(1) UPA failed to use Rs 72500 crore for Dalits: Study
(2) 232 posts of high court judges still lying vacant
(3) I want to re-settle Tamil peoples as soon as possible: Rajapaksa
(4) SAIL terminates Rs 2000 crore contract with Posco
(5) Matrix Laboratories Limited earns net profit of Rs 29.9 crore in FY08
(6) Initial work on Bhatinda oil refinery likely by 2011: Mittal
(7) Roger Federer wins sixth Wimbledon title
(8) Williams sisters retain Wimbledon doubles title
(9) India won the one-day series against the West Indies 2-1 after Sunday’s fourth and final match was abandoned due to heavy rain
(10)Unmanned Aerial Vehicle developed by a team of ten undergraduates from Delhi College of Engineering has won the prestigious Unmanned Aircraft System International Competition held in the US

5 Stories for Today

(1) One killed, 400000 displaced in Assam floods
(2) Two dead, two injured in Honduras clashes: Police
(3) Shriram Transport Finance to raise Rs 1000 crore via NCDs
(4) Partner Re to buy rival Paris Re in $2 billion deal
(5) Rs 3000 crore package for textiles industry

(1) One killed, 400000 displaced in Assam floods

One person was swept away in Majuli islands as the flood situation in Assam turned critical with river Brahmputra and its tributaries crossing the danger mark, affecting over five lakh people in ten districts.

Normal life was crippled as large parts of Lakhimpur, Dhemaji, Dibrugarh districts, Jorhat in upper Assam, Morigaon in central Assam and Barpeta, Kamrup (Guwahati), Bongaigaon, Dhubri and Baksa in lower Assam were submerged by the swollen rivers due to incessant rains in catchment areas.

In world's largest river island Majuli, almost the entire island got flooded and a villager was swept away.

The situation in the districts of Barpeta, Bongaigaon, Dhubri and Baksa was grim with flood waters submerging nearly 50 villages and affecting more than one lakh people.

In worst-hit districts of Lakhimpur, Dhemaji and Jorhat, vast tracts of land remained under water following embankment breaches caused by heavy rainfall in the foothills of Himalayas in Arunachal Pradesh.

In Dhemaji district, water of river Semen has inundated vast tracts of land in Jonai sub-division while water of rivers Gai and Jiadhol was also in spate.

Personnel of the National Disaster Rescue Force (NDRF) were engaged in rescue operations.

(2) Two dead, two injured in Honduras clashes: Police

Soldiers shot dead two people and at least two others were injured in clashes at the Honduran capital's airport ahead of the expected arrival of ousted President Manuel Zelaya, police said on Sunday.

"We have two dead and two wounded. The police didn't fire. It was the army because the demonstrators were trying to get on the runway," police Commissioner Mendoza said. Among those killed was a young boy, according to an Al-Jazeera television cameraman on the scene. Protesters said the other was a teenage girl.

Shortly beforehand, soldiers fired tear gas to break up groups of protesters armed with sticks who were trying to enter the airport, an AFP journalist witnessed.

Around 30000 people assembled around the airport Sunday for the imminent return of Zelaya, who was sent away in his pajamas a week ago after a dispute with the country's courts, army and politicians over his bid to change the constitution to allow him to run for a second term.

(3) Shriram Transport Finance to raise Rs 1000 crore via NCDs

Commercial vehicle financier Shriram Transport Finance Company (SFTC) seeks to raise up to Rs 1000 crore through the issue of debentures to augment its financial capabilities.

"The company has filed its draft prospectus with the National Stock Exchange (NSE) for its proposed public issue of secured non-convertible debentures (NCD), aggregating to Rs 500 crore with an option to retain over-subscription up to Rs 500 crore for issuance of additional NCDs," SFTC said in a statement today.

According to the company, it intends to use the funds raised through the issuance of NCDs for various financing activities, including lending and investments.

The company has appointed four firms — ENAM Securities, A K Capital Services, ICICI Securities and Kotak Mahindra Capital Company — as the lead managers to the issue, while Integrated Enterprises (India) would be acting as the registrar to the issue.

STFC is a part of the Shriram conglomerate which has presence in various financial services like commercial vehicle financing business, consumer finance, life and general insurance, stock broking, chit funds and distribution of financial products.

The company is one of the largest asset financing NBFCs in India with a niche presence in financing pre-owned trucks and small truck owners.

(4) Partner Re to buy rival Paris Re in $2 billion deal

Bermuda-based reinsurer Partner Re said that it will acquire smaller rival Paris Re in a $2 billion deal that catapults the company into the No. 4 spot among global reinsurers. Partner Re Chief Executive Patrick Thiele said the financial and global economic crisis led the company to pursue the acquisition.

"The world is in the process of change and reinsurers and insurers will likely have to change as well. We feel we will be more competitive with a larger amount of capital and diversification," he said in a telephone interview. Partner Re will exchange 0.30 of its common shares for each Paris Re common share in an exchange offer that currently values the deal at $1.7 billion.

In addition, Paris Re also plans to make a special cash distribution to shareholders of $310 million, or about $3.85 a share, prior to Partner Re securing majority ownership. Paris Re's shares closed on Friday at 12.30 euros. Partner Re, which said it had already acquired about 6 percent of Paris Re's outstanding shares, intends to acquire full ownership through a two-part exchange offer, including an agreement with a group of Paris Re's founding private equity shareholders to purchase about 57 percent of outstanding stock through a block transaction expected to close in the fourth quarter.

The company said it expects to be able to acquire the balance of outstanding shares by the first quarter of 2010. A final integration plan is not yet hammered out because the deal is still six to nine months from closing, said Thiele.

Partner Re, which was formed in 1993 in response to contraction in the property-catastrophe reinsurance market after Hurricane Andrew, bought Paris reinsurer SAFR in 1997, and Winterthur Re, the reinsurance operations of Winterthur Insurance Group, in 1998. The Paris Re acquisition is not expected to affect Partner Re's financial strength ratings, added Thiele.

Partner Re, which derives nearly half of its premium volume from the European market, has a large operation in Paris. Thiele said that gives the two companies a "compatible culture," and minimizes any risks in integrating Paris Re into the company. He did not rule out job cuts. Paris Re has about 400 employees, and Partner Re has about 1,000.

Paris Re was formed in 2006 by a consortium of investors led by Trident III, a fund managed by Stone Point Capital, the former private equity arm of insurance broker Marsh & McLennan. Other investors included Hellman & Friedman, Vestar Capital Partners and ABN Amro. Partner Re Chief Financial Officer Albert Benchimol told Reuters the acquisition was expected to be modestly accretive to Partner Re's book value, and open up significant opportunities.

In December 2006, Paris Re reached an agreement to assume the reinsurance business of French insurer Axa. Axa still owns some Paris Re stock and has agreed to the Partner Re exchange agreement, said Thiele. In addition, Axa will remain responsible for maintaining reserves for any Axa Re liabilities prior to 2006, cutting the risk of prior-year claims. While the company is not making financial projections related to the deal, it does expect to achieve its goals of at least 13 percent return on equity for investors, and 10 percent growth in book value per share annually.

Partner Re, based on shareholders' equity, currently ranks as the 8th largest global reinsurer, and expects to land in the No. 4 spot after the acquisition, said Benchimol. The world's top three reinsurers are Munich Re, Swiss Re, and the reinsurance operations of Warren Buffett's Berkshire Hathaway.

(5) Rs 3000 crore package for textiles industry

The government has offered a helping hand to the country's ailing textile sector by announcing an Rs 3000 crore ($627 million) financial package to waive loan over dues of handloom cooperatives and make available loans at concessional rates for the industry.

"The government has formulated a financial package of Rs 3000 crore for waiver of the over dues of loans of the handloom cooperatives of the country and also, to provide loans at concessional rates of 7 per cent per annum," Minister of State for Textiles Panabaka Lakshmi has said. The proposal has been sent to the finance ministry for approval.

Textiles, the second largest employment generating sector in the country after agriculture, has seen about 600,000 job losses after a host of mills closed down since the slowdown hit the economy in September.

According to the Kolkata-based Directorate General of Commercial Intelligence and Statistics, India's textiles and clothing exports have reported a growth of over 7 per cent year-on-year in rupee terms between April 2008 and February 2009.

"However, in dollar terms, it recorded a decline of 5.31 per cent," Lakshmi said.

According to her, the government will implement five new schemes during the 11th Five-Year plan period (2007-12) for the development of the handloom sector and the welfare of weavers.

Integrated Handloom Development scheme, Handloom Weavers' Comprehensive Welfare scheme, Marketing and Export Promotion scheme, Mill Gate Price scheme and Diversified Handloom Development scheme are the five schemes.

Textiles Minister Dayanidhi Maran had earlier said the government would take steps in short, medium and long term to pull the industry out of the gloom.

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