Anand Jain’s firm buys 10% stake in Gokaldas Exports

Anand Jain, chairman of Jai Corp and a confidante of Reliance Industries chairman Mukesh Ambani, has picked up nearly 10% equity stake in Gokaldas Exports, a leading player in the readymade garment industry.Mr Jain’s acquisition coincides with Reliance Industries’ attempt to revive ‘Only Vimal’ and other textile brands. Reliance Industries, which started as a textile company in 1979, now earns less than 1% of its revenues from the textile business.

Blackstone had acquired a 50% stake in Gokaldas from its promoters last year. The deal was pegged at Rs 275 a share, 20% higher than the ruling market rate at that time, making it the country’s largest management buyout in the textile industry. It was followed by the mandatory open offer to shareholders which increased Blackstone’s stake to 68%.
The US-based PE giant Blackstone is the largest shareholder in Gokaldas, with a 68% holding. The Hinduja family, the original promoters of the company, now holds 20%.

Private equity firms invest record $3.8 bn in India

Global private equity firms, including Blackstone and Carlyle Group, have made an investment of $3.8 billion in 2007 so far in the country, up 50 per cent from the year-ago period.

The record volume has been reached through 81 M&A deals. Last year, foreign private equity players had invested $2.6 billion, data complied by global consulting firm Dealogic showed.

Carlyle Group is the leading "financial sponsor" in India with investment of $777 million via two deals, including acquisition of over six per cent stake in HDFC.

It is followed by Dubai International Capital, which acquired a 2.87 per cent stake in ICICI Bank for $741 million, and Blackstone Group with $619 million inflow via eight deals.

Blackstone Group, the world's leading private equity firm, has acquired stake in companies such as Intelenet Global Services, Punj Lloyd and Gokaldas Exports.

The US-based Group has also decided to pump in $150 million to acquire a stake in Nagarjuna Construction Company. A move that comes close on the heels of its decision to acquire up to 70.1 per cent stake in Gokaldas Exports, the country's biggest apparel exporter, for about Rs 675 crore.

Blackstone Group manages around $90 billion of assets worldwide. In January, it invested about $275 million in Ushodaya Enterprises Ltd (UEL), a media and film production company owned by Ramoji Rao.

Blackstone buys Gokaldas Exports

Global private equity giant Blackstone Group is acquiring majority control in Gokaldas Exports for nearly Rs 660 crore, in the country’s largest management buyout in the textiles industry.

Blackstone will acquire a 70 per cent stake in Gokaldas through a two-step deal — 50 per cent from the Bangalore-based Hinduja family and 20 per cent through an open offer to other shareholders. Kotak Investment Bank was the advisor to the transaction and is the manager for the open offer.The deal will price one share of Gokaldas Exports at Rs 275, a 20 per cent premium over today’s close of Rs 228.70.

This is Blackstone’s third major deal this year, the other two being a $275 million investment in Ushodaya Enterprises, which runs the Eenadu newspaper and ETV franchise, and a management buy-out of BPO firm Intelenet from Barclays and HDFC for Rs 840 crore.

Akhil Gupta, CMD of Blackstone Advisors India, said his company was attracted by the growth potential of Gokaldas. “With the abolition of the quota regime, the potential of Indian textiles exporters is huge,” he added.He said Blackstone would restructure the Gokaldas board after the open offer.

Read more in The Business Standard article.