Blackstone snaps up Essel Propack for Rs 3,211 cr, acquires majority stake at Rs 134 per share

Mumbai: American buyout major Blackstone has agreed to acquire a controlling stake in Essel Propack, one of the largest manufacturers of laminated tubes used mostly by the FMCG and pharma companies, for $462 million or around Rs 3,211 crore. The two-legged deal involves Blackstone buying 51 percent stake from promoter Ashok Goel Trust, which owns 57 percent in Essel Propack for Rs 2,157 crore or $310 million, apart from an open offer for an additional 26 percent stake Rs 139.19 a share, which will be worth $152 million, taking the total deal consideration to $462 million or Rs 3,211 crore, the companies said. Goel, who also runs Essel World, the first amusement park in Mumbai, is the younger brother of Subash Chandra, the promoter of the financially troubled Essel group that has an indebtedness of Rs 17,174 crore. Giving a breakup of the deal, Amit Dixit, senior managing director and head of private equity at Blackstone India told reporters in a con-call Monday evening that “based on the open offer subscription, the purchase price will vary between Rs 2,157 crore and Rs 3,211 crore.” The sale expected to be completed in the coming few months, subject to customary closing conditions and approvals. The private equity fund will pay Rs 134 a share to acquire a 51 percent stake from Ashok Goel Trust, and will launch an open offer for an additional 26 percent at Rs 139.19 a share, Essel Propack said.