The US-based Blackstone Group, a global private equity fund with $85 billion in assets under management, today agreed to acquire 50.1% stake in Bangalore-based apparel exporter Gokaldas Exports at Rs 275 per share valuing the enterprise at around Rs 1,000 crore.
Blackstone will also make an open offer for 20% shares, according to Sebi guidelines, at Rs 275 per share.
The total cost of the acquisition, including the public offer, will come to $165 million. This is one of the of the largest private investment in a public enterprise in the apparel sector.
According to Gokaldas Exports, the acquisition will help the company become a global player in the garment sector. "Blackstone is an ideal partner for us. They have a lot of investment in the textile and retail sector globally, which will help us get more partners to work with," Rajendra Hinduja, managing director, Gokaldas Exports said.
"Gokaldas is the leading company in India in an industry that has seen significant growth in the Asian region post the elimination of the garment quota regime in 2005. This favourable industry dynamic combined with our highest regard for the management team of Gokaldas Exports were key factors in our decision to enter into this partnership," Blackstone Advisors India chairman and managing director Akhil Gupta said.
Following the acquisition, Blakstone will have a representation on the board of directors while the founder-promoters would continue to lead the company with Madanlal Hinduja as chairman, Rajendra Hinduja as managing director and Dinesh Hinduja as executive director.
A part of the funds, which Blackstone will invest, is also expected to be used to finance its 400-acre, Rs 2,000 crore special economic zone at Kanakapura on the outskirts of Bangalore. A spokesperson said they were going through the process of getting approvals for this project, which is expected in the current financial year.
Gokaldas Exports, the biggest apparel exporter in the country, has 47,000 employees in 46 manufacturing facilities with a system capacity to produce and export 2.5 million garments a month. Gokaldas exports apparel to brands like Nike, Adidas, GAP, Tommy Hilfiger and Abercrombie and Fitch.
Gokaldas is now looking at tapping the domestic market as the rising rupee is hitting exporters.
Blackstone will also make an open offer for 20% shares, according to Sebi guidelines, at Rs 275 per share.
The total cost of the acquisition, including the public offer, will come to $165 million. This is one of the of the largest private investment in a public enterprise in the apparel sector.
According to Gokaldas Exports, the acquisition will help the company become a global player in the garment sector. "Blackstone is an ideal partner for us. They have a lot of investment in the textile and retail sector globally, which will help us get more partners to work with," Rajendra Hinduja, managing director, Gokaldas Exports said.
"Gokaldas is the leading company in India in an industry that has seen significant growth in the Asian region post the elimination of the garment quota regime in 2005. This favourable industry dynamic combined with our highest regard for the management team of Gokaldas Exports were key factors in our decision to enter into this partnership," Blackstone Advisors India chairman and managing director Akhil Gupta said.
Following the acquisition, Blakstone will have a representation on the board of directors while the founder-promoters would continue to lead the company with Madanlal Hinduja as chairman, Rajendra Hinduja as managing director and Dinesh Hinduja as executive director.
A part of the funds, which Blackstone will invest, is also expected to be used to finance its 400-acre, Rs 2,000 crore special economic zone at Kanakapura on the outskirts of Bangalore. A spokesperson said they were going through the process of getting approvals for this project, which is expected in the current financial year.
Gokaldas Exports, the biggest apparel exporter in the country, has 47,000 employees in 46 manufacturing facilities with a system capacity to produce and export 2.5 million garments a month. Gokaldas exports apparel to brands like Nike, Adidas, GAP, Tommy Hilfiger and Abercrombie and Fitch.
Gokaldas is now looking at tapping the domestic market as the rising rupee is hitting exporters.
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