Marriott books Starwood to create biggest hotel company !!!!!!

US-based Marriott International announced Monday that it will acquire Starwood Hotels & Resorts Worldwide in a $12.2 billion deal that will  catapult it to become the world’s largest hotelier by a wide margin.

The two companies had combined revenues of nearly $19 billion in 2014 and currently have 5,500  properties  and about 1.1 million rooms worldwide. The combined company will dwarf number-two global hotelier Hilton, which has 4,500 hotels and 735,000 rooms.

The agreed merger unites Marriott brands, which include Ritz-Carlton, Renaissance,JW Marriott, Fairfield Inn and Starwood marks like Westin, St. Regis, W and Sheraton. The merger will give Marriott 30 brands and more leverage with corporate travel departments. Frequent business travelers will also be closely watching the deal. Starwood has a beloved frequent guest program with partnerships with American Express, Delta Air Lines and Uber. Marriott has a much larger programme with partnerships with Chase, United Airlines and several others.

Starwood shareholders will receive 0.92 shares of Marriott International, Class A common stock and $2.00 in cash for each share of Starwood common stock, a joint statement from the companies read.

Starwood shareholders will separately receive about $7.80 per share from a transaction set to close prior to the Marriott-Starwood merger closing — the spin-off of the Starwood timeshare business and its merger with Interval Leisure Group, which has an estimated value of approximately $1.3 billion.

Marriott said it expected one-time transaction costs of $100 million-$150 million related to the deal. The company expects to deliver at least $200 million in annual savings in the second full year after closing.

Economies are faltering

A slowing down in growth rate, A record high current-account deficit. A weakening currency.  A spike in inflation.  A fall in the stock market, An increase in  job losses (right sizing or is it down sizing ) in  all most all the sectors. This is  a  phenomena happening in India”s  current economic scenario.  The economy is  worsening  day by day.

 

The same recipe that is creating India’s worst economic crisis in decades is now afflicting  few other  economies as well.   Indonesia  Consumer prices jumped 8.6 percent last month, the current-account deficit had hit  4.4 percent of Indonesian GDP.  Thailand  GDP contracted 0.3 percent in the second quarter compared with the first three months of the year. That’s the second quarterly contraction in a row for Thailand, which  confirms that Thailand is now   falling into recession.

 

A fierce selloff in many  economies ( Emerging /RDE) currencies shows no sign of abating as the expected withdrawal of US monetary stimulus prompts investors to shun markets seen as riskier because of funding deficits, slowing economies and  rising inflation. A decline in the Fed's bond purchases will push government debt yields higher, which should raise the attractiveness of the dollar and dollar-denominated assets. In many of these economies,  it has been hammered by doubts over the efficacy of policy actions to stem the rout.

In India, the rupee's sell-off threatens to drive Asia's third-largest economy towards a full-blown crisis. While the Indian government and central bank have unveiled measures ( though not enough) to support the rupee, investors are unimpressed. Bolder structural reforms, including greater fuel price liberalization, land acquisition reforms, and higher foreign investment limits in  retail, insurance,  and  few other industry are crucial to regain investor confidence and shore up the rupee else we are slowly approaching the early 1990’s.

 

Another Block buster bites the dust

Yet another milestone on pharma's journey away from the mega blockbuster era: Plavix (the world's second-best-selling medicine) goes off patent. And unlike Pfizer BMS plans to back off Plavix marketing immediately. Thanks to the monopoly Plavix enjoyed, USD 9 Billion on its peak and it brought in $6.6 billion in net U.S. sales last year and the drug has generated an estimated $42.8 billion for the company during its 15 years on the market.

FDA said it gave seven companies permission to sell generic Plavix or clopidogrel in the standard 75-milligram dose. According to the FDA, 75-milligram generic Plavix can now be sold by Apotex Corp., Aurobindo Pharma, Mylan Pharmaceuticals, Roxanne Laboratories, Sun Pharma, Teva Pharmaceuticals and Torrent Pharmaceuticals.

The larger dose of 300 mg will be sold by Dr. Reddy's Laboratories, Gate Pharmaceuticals, Mylan and Teva.

Solvay to Acquire Rhodia

Solvay has agreed to acquire Rhodia for €3.4 billion in cash and  expects to close the deal in late August 2011 subject to antitrust approval both  in Europe and the U.S. The merged entity will retain Solvay’s name.

The merged company will have combined sales of more than  €12 billion/year.  Solvay posted sales of €7.1 billion and Rhodia posted sales of €5.23 billion in 2010. About 40% of combined sales will be in emerging markets.  Solvay expects transaction should create synergies leading to annualized cost savings of €250 million within three years.

About 90% of the combined company's sales will be generated by businesses in which it has a top-three position worldwide. In Solvay's case, these businesses include specialty polymers, soda ash, and hydrogen peroxide. For Rhodia these include silica, rare earths, surfactants, acetate and nylon-6,6 engineering plastics. 

CW

NPPA Revised prices for Medicines

Prices of 62 drugs, mainly used for treating diabetes and tuberculosis, have been raised while the rates of 14 other medicines have been reduced  ,  prices of 21 drugs have remained unchanged after a fresh review of the pricing of key medicines by the National Pharmaceutical Pricing Authority (NPPA).

The NPPA, which considered rates for 19 drugs for the first time, reviewed prices of drugs used in treatment of diabetes, allergy, malaria, diarrhoea, asthma and hypertension along with antiseptics.

The NPPA also revised prices of four bulk drugs, following which diuretic spironolactone and salbutamol sulphate will be cheaper by 2.5 per cent and 18.87 per cent respectively.

According to it, bulk drug pyrantel pamoate (used in formulations of deworming medicines) and anti-allergic pheniramine maleate will be costlier by 8.12 per cent and 13.87 per cent respectively.

The reduction in prices of formulation drugs has been in the range of 2.47 per cent to 35.04 per cent from the prices claimed by the respective companies.

The price revision included more than 25 anti-TB drugs for which there was no significant increase while sulphadoxine plus pyrimethamine tablets will cost more due to upward revision in the import price of bulk drugs used for malaria.

India General Budget- 2011-12 HIGHLIGHTS

AC hospitals with more than 25 beds under service tax

Domestic travel to pay Rs 50 service tax, Rs 250 on international travel

Health check-up services now attract service tax

No change in Central Value-added Tax rates

No new tax exemption limits for women

Cut in import duties of raw material for mobile phones

Basic food, fuel exempted from central excise duty

Tax sops of Rs 20,000 on infra bonds extended by a year

1% excise duty on 130 new items

Rs 5 lakh tax exemption limit for individuals above 80 years of age

SEZ to come under MAT

Minimum alternative tax raised 185% vs 18%

Tax exemption limit increased to Rs 5 lakh for senior citizens

Eligible age for senior citizens is now 60 years against 65 years earlier

Exemption limit for individual tax payers raised to Rs 1.8 lakh from Rs 1.6 lakh

SC/ST scholarship scheme will benefit about 40 lakh students

Scholarships to SC/ST students in Class IX and X

Social projects spending outlay up 17% to Rs 16 lakh crore

Metro projects in key cities will get financial aid

Short term interest to farmers will continue to be at 7%

New companies bill to be introduced in this session

FII allowed to invest in MF schemes

FII limit in corporate bonds has been raised.

Highlights- Indian Budget 2010-11

• Section 80c investment limit hiked by Rs. 20,000.
• Service Tax rates unchanged.
• Customs duty on Gold and Platinum hiked.
• Excise duty on solar panels waived.
• Excise duty on CFL halved to 4%.
• Jewellery to be more expensive.
• CDs to be cheaper.
• Mobile phones to become cheaper.
• Refrigerators/Televisions Air conditioners to be costlier.
• Peak customs duty unchanged at 10%.
• Cement to be costlier.
• Excise duty on petrol and diesel raised to Rs 1/litre.
• 5% duty on crude petroleum restored.
• Excise on all non smoking tobacco raised.
• 7.5% duty on petrol and diesel restored.
• Excise on large cars,SUVs, MUV raised to 22%.
• Cigarettes to be costlier.
• Deduction of Rs 20000 on investment in infra bonds.
• Weighted deduction on R&D raised to 200% from 150%.
• No tax on Income up to Rs 1.6 lacs.
• Current surcharge on companies reduced to 7.5%.
• No tax on Income up to Rs 1.6 lacs.
• Minimum Alternate tax hiked to 18%
• 30% tax on income above Rs 8 lacs.
• 20% tax on income between Rs5 lacs to 8 lacs.
• 10% tax on income between Rs1.6 lacs to 5 lacs.
• IT dept to notify Saral 2 form for individual tax payers.
• IT exemption limit enhanced, surcharge withdrawn.
• 20 Kms of highway to be constructed everyday.
• More than 50% increase in funds for minority welfare.
• 15% rise in planned expenditure.
• Defence capex raised to Rs 60000 Cr.
• Home loans up to Rs 20 lacs to get intrest subvention of 1% up to March 11.
• Government to contribute Rs 1000 per month for pension security.
• Rs 1,900 Cr. allocated for UID project.
• Intrest subvention for housing loans up to 1 lacs.
• NREGA scheme allocation raised to Rs 41000 Cr.
• Allotment for renewable energy hiked by 61%.
• Setup Coal regulatory authority.
• 2% loan subsidy to farmers.
• Rs 165,000 Cr. additional for bank re-capitalisation.
• Chances of banking licenses to Pvt cos and NBFCs from RBI.
• Foreign direct Investment (FDI) policy to made more user friendly
• Reduce to 'Fertilizer Subsidy'.
• GST will implement from 2011
• Plan to implement 'Direct Tax Code' from April 2011

Another Bubble likely

A year ago investors were panicking and there was talk of another great Depression. Now the share prices in all most all the economies are 70-100 % higher than their respective lows of 2009. This was mostly due to interest rates of 1% or less in America, Japan, Britain and the euro zone, which have persuaded investors to take their money out of cash and to buy risky assets.

Central banks see these market rallies as a welcome side- effect of their policies. The market rebound was necessary to stabilise economies last year, but now there is a danger that bubbles are being created. Apart from high asset valuations, the other symptoms of a bubble are rapid growth in private-sector credit and an outbreak of public enthusiasm for some particular assets. The longer the world keeps its interest rates close to zero, the greater the danger that bubbles will appear and its most likely in emerging markets specially China.

The remedies could be forcing banks to adopt higher capital ratios which will curb speculative excesses apart from the interest rate which clould me a major tool to curb speculation. But central banks are wary of using these measures to pop bubbles because it risks of crushing growth as well. Current scenario of high asset prices, low interest rates and massive fiscal deficits seems unsustainable.

Interest rates will stay low only if growth remains slow. But if economies grow slowly, then profits will not rise fast enough to justify current share prices and incomes will not rise far enough to justify the prevailing level of house prices. On the other hand, if the markets are right about the prospects for economic growth, and the current recovery is sustained, then governments will have to react by cutting off the supply of cheap money.