Bain Capital sells 4.4% stake in Hero for $400 mn

Private equity major Bain Capital has raised about $400 million (Rs 2,467 crore) by selling about 4.4 per cent stake in India's Hero MotoCorp. Bain Capital sold 8.55 million shares in India's largest maker of motorcycles and scooters on Friday.

According to the term sheet, Bain Capital was planning to sell nearly 4.3 million shares (2.2%) in Hero MotoCorp, with an option to sell more. Before the transaction, Bain was holding 11.5 million shares or 5.77% stake in Hero Motocorp.

As per the term sheet, Bain had offered Rs 2,859.6-2,963 apiece for selling its shares in Hero. In June, Bain had sold 2.8 per cent, or around a third of its holding, for Rs 1,480 crore ($248 million). It had offered a band of Rs 2,582-2,717 a share.

Bain holds stake in Hero through its arm BC India Pvt Investor II. On Friday, Hero shares were closed at Rs 2,898.5 apiece, down 1.99 per cent on BSE.

Three years ago, Bain had invested with Singapore's sovereign wealth fund GIC to back the Munjal family for buying out Honda Motor from their joint venture.

Through their private holding arm Hero Investments Pvt Ltd (HIPL), Munjals acquired the 26 per cent stake held by Honda Motor and a minority stake in HIPL was sold later to Bain Capital and GIC to retire the debt.

Last year HIPL was merged with the listed company giving direct equity stake to Bain and GIC. It is learnt that both Bain and GIC had jointly invested about $850 million (3800 crore) in Hero Investments. The PE major held 19.81 per cent stake in Hero Investments Private Ltd.