Private equity giant Blackstone Group is consolidating its position in IT services firm MPhasis Ltd by acquiring additional stake, taking advantage of the fall in share price.
Blackstone has acquired 4.01% stake in Mphasis for about Rs 525 crore ($69 million) after its share price fell more than one-third from its year-high in mid-March in a widespread market sell off because of Covid-19, said multiple people aware of the development.
The New York-based alternate asset manager acquired about 7.48 million shares through its unit Marble II Pte during March 17-20. “Shares were acquired at an average price of Rs 696. Blackstone used this significant fall in share price as an opportunity to consolidate holdings, and supporting management teams during testing times,” said a person aware of developments.
With this, Blackstone’s holding in the company rose to 56.21% from 52.20%, exchange filings showed.
Mphasis shares fell 32.41% from a 52-week high of Rs 1,015 in June 2019. In the same time, the benchmark Sensex witnessed a fall of 38.23% from its record high of 42,063 posted in January.
In 2016, Blackstone had acquired 60.5% stake in Mphasis Ltd from Hewlett Packard Enterprise for $1 billion, in the largest acquisition by Blackstone in India. Blackstone had paid a purchase price of Rs 430 per share to HPE. Later in 2018, Blackstone had sold a total of 8% stake in Mphasis at an average price of Rs 926 and reduced their stake to 52% in the company.
Blackstone has deployed over $15 billion through real estate and private equity investment since it started operations in India in 2016. Recent deals include the buyout of Aadhar Housing Finance Ltd, Aakash Educational Services, Essel Propack Ltd and minority investment in Future Lifestyle Fashion.
Blackstone has $571 billion in assets under management, through investment vehicles focused on private equity, real estate, public debt and equity, growth equity, opportunistic, non-investment grade credit, real assets and secondary funds, globally.
Source: Economic Times