Global private equity player Blackstone Group has reworked its investment proposal and will now invest less than Rs 600 crore in Ushodaya Enterprises, the company that owns leading South Indian newspaper Eenadu.The reworked proposal was submitted to the Foreign Investment Promotion Board (FIPB) recently, in which the private equity major now proposes to pick up around 14 per cent stake (as against the earlier 26 per cent for Rs 1,081 crore).
The reduction in Blackstone’s investment would obviate the need for the proposal to be vetted and cleared by the Cabinet Committee on Economic Affairs (CCEA). As part of existing Government policy, all proposals which have a foreign direct investment of over Rs 600 crore have to be finally approved by the CCEA.
Blackstone’s new proposal will be vetted at the FIPB itself, a process that should speed up approval. There is a sense of urgency surrounding the deal and the parties concerned are keen to wrap up the deal by February.
As per the original proposal, announced last January, Ushodaya planned to raise $465 million, with Blackstone investing $275 million and $190 million raised through bank financing. The deal was stuck for nearly a year on account of several objections raised to the proposed transaction.
Read more in The Business Standard article.
