Hedge funds, for long the masters of the finance universe, are playing a game not quite their size in India by betting on early-stage companies and thus altering the balance of the startup industry as well as the riskcapital business in the country. Recognised globally for their short-term investment horizon and preference for liquid, public market assets, these funds are pouring cash into Indian consumer Internet businesses, stoking anticipation among entrepreneurs and consternation amongst venture capitalists that compete for the same deals.

Publicis Groupe SA agreed to pay $3.7 billion for Sapient Corp, pushing the third-largest advertising company deeper into digital offerings in the US as it moves past the distraction of a failed merger with Omnicom Group Inc. Sapient stockholders will receive $25 in cash for each share they own, the companies said on Monday. The price is 44 per cent more than Boston-based Sapient's October 31 close in New York. Both companies' boards have approved the offer and Sapient Chief Executive Officer and Co-Chairman Alan J. Herrick will become CEO of Publicis.Sapient. Publicis' shares fell 3.3 percent to Euro 53.44 in Paris.

Indian companies announced mergers and acquisitions (M&A) transactions worth $4.7 billion in the July-September quarter across 203 deals, marking a decline of 13% in terms of deal value from a year earlier. However, the number of deals went up by 21.6%, according to consulting firm EY. The decline was attributed to a single $2.6 billion mega deal last year—that of ONGC Videsh Ltd’s acquisition of a 10% stake in Mozambique’s Rovuma offshore block. If this deal is excluded, the quarter registered an increase of 71% in deal value against last year.

India's largest online travel portal, MakeMyTrip wants to bet aggressively on driving business through mobile phones and expects almost 50 per cent business from it in next three years with plans to roll out vernacular language capability. It also wants to acquire firms with technological capability on mobile application to beef up its resources sitting on a cash pile of Rs 300 crore, said founder and CEO Deep Kalra. Kalra said 20 per cent of total site visits or traffic and 13 per cent of total transactions at MakeMyTrip is driven through mobile phones from nil in the last 18 months.

In its 2007 report, research firm Forrester termed firm Syntel Inc as “small enough to listen, big enough to deliver” as the differentiator, adding the mid-tier IT firm had maturity.With 80 per cent of its employees based in India, Syntel earns about 85 per cent of revenues from IT and the rest from knowledge process outsourcing businesses.Historically, the mid-tier company had stayed away from acquisitions but with cash in hand of about $552 million (as June quarter end) now it has enough “gunpowder”. The company has also set up a team to scout for opportunities, Prashant Ranade, President and Chief Executive Officer, Syntel, said in an interview to Business Line. He is hopeful on the overall business environment, adding that the market conditions have firmed up.

It was a Rs 400-crore deal that fell flat at the last stage. Sameer Tapia, senior partner of ALMT Legal, advised a PE fund into the final stages of an investment in an Indian company, when due diligence unearthed several undisclosed cash transactions, not part of normal business activities, in the books of a subsidiary.

The government is likely to give its nod to the much-awaited $1.6-billion acquisition of Strides Arcolab's injectible unit, Agila Specialities, by the US generic drug maker Mylan Inc soon. However, the deal might come with certain riders, sources said. After the recent meeting on foreign direct investment (FDI) in the pharmaceutical sector, where the proposed deal was discussed in detail, the commerce ministry and the Foreign Investment Promotion Board are actively working on all pending proposals in the sector to clear these at the earliest. However, some of these pending proposals, including the Mylan-Strides transaction, which involve sensitive issues involving public interest,

Corporate India's merger and acquisition deal value touched $ 1,503 million in July, registering a decline of over 34 per cent compared to the corresponding period last year, says a report.According to audit and advisory firm Grant Thornton, total M&A deal value announced by India Inc stood at $ 1,503 million through 40 transactions. There were 44 deals worth $ 2,291 million in the same period last year.

Real estate consultancy services company Cushman & Wakefield is looking at Indian buys to consolidate operations. The consultancy sees the real estate sector adopting a cautious approach this year. While many global investors are keen to come in , they want the reforms expedited to before making their moves. Sanjay Verma, Chief Executive Officer, Asia-Pacific, Cushman & Wakefield, spoke about various issues that are confronting the real estate sector during a recent visit to Hyderabad. Excerpts:

Atul Nishar, founder of Hexaware Technologies, has been planning an exit for private equity investor General Atlantic for at least 12 months now. The PE fund's Rs 300-crore investment made at Rs 142 a share seven years ago is now trading at Rs 118 a share. "Whenever GA wants to sell its stake, we will help find a suitable PE fund to buy it," says Nishar. Bankers were appointed a while ago to squeeze out an exit. A secondary offer was considered, so was a sale to another PE fund (called a secondary sale). But an exit is nowhere in sight.

Circa 2013, the city of Lodz is in central Poland. In 1913, Lodz was in Russia. In 1914, it was in Germany. In 1918, Lodz was stateless for a while before it joined the Polish Republic. It was repossessed by Germany in 1939, and handed back to the Poles in 1945.The kingdom of Poland itself united with Lithuania in the 16th century. In the 18th century, Poland was carved up by Austria, Germany and Russia. It resurrected as a republic after World War I. In 1939, it was carved up by Russia and Germany. After World War II, it became a Soviet protectorate. It is now part of the European Union (EU). Poland is typical. The world's political map, including, of course, the subcontinent, has been redrawn multiple times, usually with vast amounts of attendant bloodshed. Now, Telangana has sparked off agitations for Gorkhaland, Bodoland, reorganisation of various other states, and also for the autonomy of mega-cities.

India’s weak macro environment may have put off many an investor, but deals being struck by private equity players have actually picked up pace, perhaps due to urgency of Indian corporates to raise equity capital in a tough funding environment. PE firms have invested $5.9 billion across 204 deals between January and June this year compared with $3.8 billion invested across 219 deals in the same period last year, according to advisory firm Grant Thornton’s “Dealtracker” report — a 55% year-on-year increase. Most of this funding has gone into sectors like information technology and related services,

A consortium of private equity (PE) funds including Tata Capital's PE fund and Morgan Stanley Global Private Equity will pick up a significant minority stake in urban microlenderJanalakshmi Financial Services for close to Rs 350 crore, signalling confidence in the long-term potential of the microfinance industry after being shattered by the financial crisis in Andhra Pradesh.The infusion of fourth round of funding comes at a time when former Citi banker Ramesh Ramanathan-promoted non-banking finance company has applied for a licence from Reserve Bank of India to transform itself into a bank.

Cognizant, the US headquartered IT services company, is scouting for acquisitions in the range of up to $200 million, which would bring significant complementary capabilities for the rapidly growing corporate, which is expected to end the 2013 fiscal with a revenue of $8.74 billion.Cognizant follows an acquisition strategy, what it terms tuck under, which is about shopping for a series of smaller firms in a consistent fashion. Talking to FE, Cognizant group chief executive (technology & operations) R Chandra Sekaran said, “We continue to look for acquisitions which is complementary to us and brings in newer capability in terms of domain, consulting or geographic reach.”Cognizant, which ended the June quarter with cash reserves of $2.9 billion has made smaller acquisitions in the recent past. For example, it acquired SourceNet Solutions from its financial services clients BNY Mellon which got them processing platform capability for its BPO business.The SourceNet acquisition is expected to add $10 million in revenue for Cognizant by end of the fiscal.

Real estate consultancy Cushman & Wakefield’s latest report on the private equity (PE) in real estate investment states that around $2 billion (Rs 11,854 crore) is available with PE firms for deployment in the Indian real estate sector. The interest comes despite the fact that PE investment flow in the first half of 2013 dropped by around 46%.The PE investments in real estate was recorded at $276 million (around 1,638 crore) in first half of 2013 as compared to $514 million (around Rs 3,050 crore) in the same period last year. The decline in the quantum of PERE investment was essentially due to less number deals (13 in H1 2013) as the average ticket size of deals remained same.

Half a dozen private equity funds are yet to invest half the money they raised in 2010 and 2011 due to scarcity of quality investment options in a slowing economy, and have now sought their investors' nod to extend fund tenure. Barings Private Equity Partners, Avigo Capital, Ascent Capital, Aavishkaar, Peepul Capital and Everstone are yet to deploy $1 billion (Rs 6,000 crore) out of $2.1 billion raised in 2010 and 2011. Typically, a private equity in India has a lifespan of seven years-first three years to invest and another four to manage the portfolio companies and exit. Rahul Bhasin, managing director and CEO of Barings Private Equity Partners India, says its limited partnership investors have agreed to extend their deadlines by a year.

Naveen Jindal-led Jindal Steel and Power has emerged as a frontrunner to acquire the Indian assets of Stemcor Holdings, the cash-strapped independent steel trader, said three independent sources aware of the ongoing discussions. The two have also entered into an "exclusivity" arrangement recently for bilateral negotiations that will allow JSPL to conduct a detailed diligence of the company and its assets.

The merger of holding companies Omnicom and Publicis Groupe is quite simply the biggest news in the history of the marketing communications industry. Speculation is rife that former global market leader WPP (which owns O&M, JWT and Grey among others) or the resurgent Japanese giant Dentsu will now make a tempting offer to Interpublic (the holding company for McCann Erickson, Draft FCB and Lowe). But it's still not going to be anywhere near the scale of the world's second- and third-largest marketing communication giants joining forces. The jury is out on what this means for India, a market where WPP is a clear leader. An agency CEO who prefers to remain anonymous says that one of the fallouts is to make Omnicom and Publicis at least as large as if not larger than Interpublic in India.

DLF, India’s largest real estate company, had initiated talks with four buyers, including leading private equity (PE) funds, for the sale of Aman Resorts, its luxury hotels chain, said a source involved in the deal. In December 2012, DLF had announced it had sold the entire stake in Aman Resorts for $300 million to Adrian Zecha, the hotel chain’s founder. Sources said Zecha had missed two payment deadlines in March and June, adding he wasn’t able to raise funds for the deal. “Adrian is still in the fray. Being a management buy-out, it is taking time to close. In the meantime, they (DLF) are also in discussions with four other buyers, including some global PE funds that are in various stages of evaluation and diligence,” the sources said.

Mumbai-based home mortgager Dewan Housing Finance Corporation Ltd (DHFL) purchased real estate developer DLF's 74% stake in life insurer DLFPramerica Life Insurance Company for Rs 220 crore with Pramerica's parent US-based Prudential International Insurance paying almost the entire amount, two people familiar with the development said. DHFL, which now mobilises hefty premium between Rs 20 and Rs 25 crore by selling ICICI Prudential Life Insurance products, leveraged its strong distribution network of 447 branches in its negotiations for the insurer to pay to the seller.