India: PE firm Blackstone sells 23% stake in Essel Propack worth $252m

Photo: Bloomberg

The world’s biggest alternative asset manager Blackstone on Friday sold a large chunk of shares, representing almost a quarter of the total shareholding, in packaging firm Essel Propack Ltd through block trades, to various institutional investors.

As per data available on stock exchanges, Epsilon Bidco Pte. Ltd, a Blackstone entity which owns 75% of Essel Propack, sold 72.58 million shares on friday at a price of around Rs256.5 apiece.

The trade fetched Blackstone approximately Rs1,861.5 crore or $252 million.

Mint reported on Thursday that Blackstone had set a floor price of Rs255 per share for the stake sale. UBS Securities India Pvt Ltd and Systematix Shares & Stocks advised Blackstone on the trade.

Shares of Essel Propack closed trading at Rs251.9 apiece, down 7.73% on the BSE.

Earlier in June, Blackstone had sold a 8.7% stake in Embassy REIT worth around $300 million.

Blackstone had acquired 75% of Essel Propack on 22 August, 2019, for $470 million at Rs134 per share, from erstwhile promoters – the Essel Group and public shareholders.

“Within 13 months of investment, Blackstone has returned $252 million by selling 23% of the company’s shares at Rs256.5 per share. This implies a 106% IRR / 2.2x Multiple of Money in USD on Blackstone’s equity, net of debt at Holding company,” a spokesperson for Blackstone said.

“The transaction was executed to create liquidity in the stock given significant investor interest after the company’s strong performance. Also, these 23% shares came in the Open Offer last year which now have been sold back to high quality global and domestic investors,” the spokesperson added.

“Within our first year of ownership, Blackstone recruited a new CEO (Sudhanshu Vats, over 20 years at Unilever, 8 years at Viacom18), CFO (Parag Shah, 7 years at Medtronic, 14 years at Unilever), a fit-for-purpose Lead Director (Uwe Roehrhoff, ex-CEO of former Blackstone portfolio company, Gerresheimer Packaging) and Chairman (DS Brar, also Chairman of Mphasis, a Blackstone portfolio company). In addition, Blackstone launched a productivity improvement program that helped deliver 170 bps of margin expansion and 400 bps of ROCE improvement.”

This article was first published on livemint.com.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.