Singapore’s sovereign wealth fund GIC has made a partial exit from Hero MotoCorp by selling about 1% stake in the company for about $81.3 million through an open market transaction; and pocketing over 2x returns (in rupee terms) on its three-year-old investment, a report said.
GIC had invested an estimated amount of between $178.8 million-$220 million (Rs 1,100 crore – Rs 1,350 crore) in Hero, and its remaining stake in the company is estimated to be worth around $260 million (Rs 1,600 crore), according to a report in India’s VCCircle.
In March 2011, GIC (through Lathe Investment Pvt Ltd) had joined Bain Capital to invest around $550 million in India’s biggest manufacturer of motorcycles and scooters, enabling the Hero Group to buyout Honda Motor Co’s 26% stake in Hero Honda Motors Ltd, since renamed Hero MotoCorp. A bulk of this investment came from Bain, while GIC is estimated to have contributed about 25%, equivalent to a little over $130 million.
Last Week, Bain Capital had sold 4.27% stake in Hero MotoCorp Ltd for $400 million in an open market transaction; and is now left with about 1.5% stake in the company. Prior to that, in June this year, Bain had sold another 2.8%, equivalent to a third of its holdings in Hero MotoCorp for around $248 million.
The VCCircle report further said the sale of Hero MotorCorp shares by the Singapore fund had made it GIC’s second part-time exit from an Indian company his fiscal. Earlier, it had sold a part of its holdings in the Marico Group. The report added that the Singapore fund had also part exited Adani Ports & Special Economic Zone Ltd last year for just under $50.8 million.