Blackstone commits up to $460 million to acquire majority stake in Essel Propack

Global investment major Blackstone said on Monday that private equity funds managed by it have entered into a definitive agreement with Ashok Goel Trust to purchase a majority stake in Essel Propack, a leading global specialty packaging company and the largest global manufacturer of laminated tubes.

Ashok Goel Trust and its affiliates currently hold about 57 per cent of Essel Propack. Blackstone will pay a purchase price of Rs 134 per share to acquire a 51 per cent shareholding from Ashok Goel Trust.

As per the Takeover Code, the transaction will trigger a mandatory open offer for a purchase of additional 26 per cent shares of the company and the acquiring entity has released a public announcement to the stock exchanges. The open offer price has been fixed at Rs 139.19 per share.

Based on the open offer subscription, the purchase price consideration will vary between Rs 2,157 crore and 3,211 crore (or 310 million to 462 million dollars). Ashok Goel will retain a minority stake in the company. The sale is expected to complete in the coming months.

Essel Propack's last year's revenue as of December 31, 2018 was Rs 2,642 crore, registering 10 per cent year-on-year growth.

"Essel Propack is a leader in emerging markets and well-positioned to benefit from consumption growth across categories," said Amit Dixit, Senior Managing Director and Head of Private Equity in India at Blackstone. "This investment follows Blackstone's long-standing belief and track record in the B2B2C sector.