Global buyout major Blackstone Monday has said it would acquire a majority 51 percent stake in the troubled Essel group arm Essel Propack for over USD 460 million or about Rs 3,200 crore.
The American fund has entered into a definitive agreement with Ashok Goel Trust, which owns 57 percent in Essel Propack, the company said.
The private equity fund has agreed to pay a purchase price of Rs 134 a share to acquire a 51 percent shares from the holding trust, and intends to purchase additional 26 percent through an open offer at Rs 139.19 a share, it said.
Post-deal Ashok Goel will hold minority stake in the company, it added. The 37-year-old Essel Propack employs over 3,150 in its 20 facilities spaning 10 countries, and manufactures 7 billion packaging tubes annually which are mostly used by the FMCG industry.
Essel Propack is a global tube-packaging company headquartered in Mumbai in India. It is part of the Essel Group, and specializes in packaging of laminated plastic tubes for the FMCG and Pharma space.
In 2013, Essel Propack employed more than 2,600 people, and operated 24 facilities in 11 countries, selling more than six billion tubes each year. At that time, globally, the company held a 33% share of the Oral Care market in terms of volume and was the world’s largest plastic tubes manufacturer
Ashok Goel’s brother Subhash Chandra, the chairman of the Essel group, is passing through financial difficulties due to some bets taken on asset-heavy new businesses that have gone awry, and is also looking at selling a part of his flagship media and entertainment business to pay back the lenders.
Essel Propack scrip closed 0.91 percent up at Rs 132.65 on the BSE, with a 1.26 percent plunge in the benchmark.
