A week after global buyout fund Blackstone picked up a majority stake in the country’s largest garment manufacturer Gokaldas Exports for $165 million (Rs 675 crore), the US-based company struck a second deal in India to pick up a 12.5 per cent stake in Hyderabad-based Nagarjuna Construction Company (NCC) for $150 million or Rs 615 crore.
“Blackstone will have representation on the Board of NCC,” NCC said in a release on Tuesday. Blackstone will make the investment in NCC in two tranches. In the first phase it will be allotted 20,246,900 shares of Rs 2 each at a premium of Rs 200.50 and 9,111,111 warrants of Rs 225 per warrant, with each warrant convertible into one equity share of Rs 2 each at a premium of Rs 223. NCC closed at Rs 194.75 on the BSE on Tuesday.
“We believe that planned infrastructure expenditure, economic growth, and urbanisation will drive long-term growth in India’s construction sector. It is a privilege to invest alongside a superb management team in a leading company in one of India’s accelerating growth sectors,” Blackstone Advisors India Chairman and Managing Director Akhil Gupta said. Blackstone has so far committed $750 million in India.
A Ranga Raju, MD, NCC said, “Blackstone brings immense value to the company. This investment will not only allow us to make additional investments in public-private infrastructure projects, but will also improve our net worth, enabling us to bid for larger projects going forward and strengthening our strategic positioning in the market.”