April 22, 2019 / 12:21 PM / 6 months ago

Blackstone buys majority stake in packaging firm Essel Propack

FILE PHOTO: The ticker and trading information for Blackstone Group is displayed at the post where it is traded on the floor of the New York Stock Exchange (NYSE) April 4, 2016. REUTERS/Brendan McDermid

(Reuters) - U.S.-based Blackstone Group agreed to buy a 51 percent stake in Essel Propack Ltd, India’s largest rigid plastic packaging provider said on Monday.

Blackstone will buy the stake from the Ashok Goel Trust at 134 rupees per share, representing a premium of 1.1 percent over the company’s Monday closing price.

Under India’s takeover rules, the transaction triggered a mandatory open offer in which Blackstone, along with Epsilon BidCo Pte Ltd, offered to buy an additional 26 percent stake in Essel for 11.42 billion rupees ($163.92 million).

The total deal value will range from $310 million to $462 million, based on the open offer. The Trust will retain a 6 percent stake in the company, Essel Propack said.

In December, Blackstone Chairman Stephen Schwarzman told the Economic Times that a reform-oriented government, weak rupee, bumper exits and new opportunities in bankruptcy and structured capital services will likely make India favourable for aggressive purchases.

($1 = 69.6700 Indian rupees)

Reporting by Chandini Monnappa in Bengaluru; Editing by Shreejay Sinha

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