THE government has approved Citicorp Venture Capital International’s proposal to pick up 15% stake in Flemingo Duty Free Shops Pvt Ltd (FDSPL) which runs duty-free shops at various airports and seaports. The deal is valued at more than Rs 100 crore. The Foreign Investment Promotion Board (FIPB) cleared Citicorp’s proposal recently and the finance minister has also approved it. The application for the foreign investment was pending with the Board. FDPSL would initially issue convertible preference shares to the Citicorp for about Rs 100 crore, official sources said. These preference shares would be converted into equity at a later date for a premium, Flemingo has told FIPB. The Citicorp’s shareholding in FDSPL would be up to a maximum of 15% of the paid-up equity of the company. Currently, Flemingo International, a company based in British Virgin Islands, holds 51.22% equity stake in FDSPL while various NRIs hold 24.87% stake. After conversion of Citicorp’s preference shares; Flemingo International, NRIs and Citicorp would respectively hold 43.54%, 21.14% and 15% in FDSPL, taking the total FDI to 79.68%. FDSPL had sought FIPB approval to issue 10 lakh convertible preference shares for Rs 1,000 each to the Citicorp. FIPB earlier deferred the FDSPL’s proposal for comments from various ministries including finance. The department of economic affairs (DEA) and the department for industrial promotion & policy (DIPP) had raised no objection. DEA had conveyed no objection to the proposal subject to issue of preference shares being in conformity to SEBI, RBI and other statutory guidelines, the sources said. FIPB has now finally approved Citicorp investment in Flemingo. Flemingo runs dutyfree shops at Delhi and a number of other airports. The company is also planning to set up duty-paid shops in downtown areas to tap potential for top international brands in metro cities.
Damas allowed 51% in FDSPL venture
THE government has cleared a proposal from Dubai-based Damas for investing 51% in a joint venture with Flemingo International’s Indian arm to set up duty-free jewellery outlets at Indian airports. Damas Jewellery LLC has set up a JV firm with the Flemingo Duty Free Shop Pvt Ltd (FDSPL) to set up duty-free shops at airports for selling jewellery products and luxury watches. The new JV company, which has been registered under the Indian Companies Act, 1956, is called Flemingo Jewellery India Pvt Ltd. The Foreign Investment Proposal Board (FIPB) has cleared the Damas-Flemingo joint ventrue, according to official sources. Damas will be selling its gold jewellery brands like harmony and legacy and its diamond brands at major airports. Damas has already been allowed to set up shops at Chennai, Trivandrum and Jaipur international airports. Operations at these airports are expected to begin within a month. While Damas is holding a 51% equity stake in the JV firm, the remaining stake will be with Flemingo, official sources said. The Damas-Flemingo venture has inked deals with stateowned Airports Authority of India (AAI) to set shops at three airports. The proposed shops shall use the brand name Damas. The JV company is also keen on starting operations at other major airports, government sources said. Being a foreign investor, Damas has sought approval from the FIPB to set up a JV firm. The sources said FIPB’s clearance to Damas allows the company to pick up 51% equity shares of Flemingo Jewellery India. The JV firm will issue 22,95,000 shares at Rs 10 face value to Damas. While Flemingo will look after the day-to-day management, Damas will depute its personnel and specify other requirement to run the business. Damas LLC, established in 1993, is engaged in the business of gold jewellery, diamonds and watches. Damas has operations in six countries, 127 retail locations and it has one manufacturing & selling division. It also jointly controls companies in India, Dubai, Kuwait, Maldives and UAE. Its annual revenue in 2005 was more than Rs 3,200 crore. Damas operates in India through D’damas India which functions in partnership with diamond house Gitanjali Digico Group. D’damas India has granted a no-objection certificate to Damas to enter into a JV with Flemingo, as per the requirements of Press Note 1 (2005).
THE government has approved Citicorp Venture Capital International’s proposal to pick up 15% stake in Flemingo Duty Free Shops Pvt Ltd (FDSPL) which runs duty-free shops at various airports and seaports. The deal is valued at more than Rs 100 crore. The Foreign Investment Promotion Board (FIPB) cleared Citicorp’s proposal recently and the finance minister has also approved it. The application for the foreign investment was pending with the Board. FDPSL would initially issue convertible preference shares to the Citicorp for about Rs 100 crore, official sources said. These preference shares would be converted into equity at a later date for a premium, Flemingo has told FIPB. The Citicorp’s shareholding in FDSPL would be up to a maximum of 15% of the paid-up equity of the company. Currently, Flemingo International, a company based in British Virgin Islands, holds 51.22% equity stake in FDSPL while various NRIs hold 24.87% stake. After conversion of Citicorp’s preference shares; Flemingo International, NRIs and Citicorp would respectively hold 43.54%, 21.14% and 15% in FDSPL, taking the total FDI to 79.68%. FDSPL had sought FIPB approval to issue 10 lakh convertible preference shares for Rs 1,000 each to the Citicorp. FIPB earlier deferred the FDSPL’s proposal for comments from various ministries including finance. The department of economic affairs (DEA) and the department for industrial promotion & policy (DIPP) had raised no objection. DEA had conveyed no objection to the proposal subject to issue of preference shares being in conformity to SEBI, RBI and other statutory guidelines, the sources said. FIPB has now finally approved Citicorp investment in Flemingo. Flemingo runs dutyfree shops at Delhi and a number of other airports. The company is also planning to set up duty-paid shops in downtown areas to tap potential for top international brands in metro cities.
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