Blackstone, the world’s largest alternative asset manager, is selling its remaining stake in Sona BLW Precision Forgings Ltd (Sona Comstar) for $640 million, two people aware of the deal said. The sale of shares through block deals is expected to close on Monday.
Investment bank JM Financial is managing the sale, the people cited above said on condition of anonymity. Blackstone currently owns approximately 20.5% stake in Sona Comstar.
Blackstone plans to sell the shares through a book-building process, with a floor price set at an 8.3% discount to Friday’s closing price. At this price, the sale would fetch at least $583 million. However, the people cited earlier said the company expects high demand and may raise as much as $640 million.
Sona BLW shares closed at ₹436.9 on Friday, against an all-time high of ₹789.3 in December 2021.
Once completed, the Sona BLW transaction will be Blackstone’s most successful exit `from India. Blackstone acquired Comstar Automotive Technologies in 2017. The next year, it bought Sona BLW Precision Forgings Ltd and merged them to form Sona Comstar. Overall, it invested around $385 million in the two businesses.
In absolute terms, Blackstone has already made ₹12,800 crore or $1.6 billion in capital gains, including through two previous part-exits from 2018 to 2012. It sold ₹5,250 crore at the time of Sona BLW’s initial public offering in June 2021. In August 2022, it sold another chunk for ₹4,044 crore. It also took some money out at the time of the Comstar-Sona BLW merger. According to a person familiar with the matter, Blackstone has already returned at least 12 times the multiple on invested capital in dollars before the latest trade.
An email sent to a spokesperson for Blackstone requesting comment remained unanswered. Sona Comstar makes parts such as differential assemblies and gears, conventional and micro-hybrid starter motors, BSG systems, EV traction motors and motor control units. It supplies them to original equipment makers across the US, Europe, India and China, according to its website.
The company reported consolidated net sales of ₹2,130.6 crore in FY22, against ₹1,566.3 crore in FY21, and profits of ₹348.2 crore versus ₹229 crore during the same period.
