|DEAL IN THE AIR
Mumbai, Oct. 6 (PTI): At least three global private equity firms are in talks to acquire up to a 24 per cent stake jointly in Bombay Dyeing, the flagship company of diversified Wadia Group, according to merchant banking sources.
The deal could be valued at over Rs 500 crore, they said, adding that the exclusivity period of the due diligence is likely to end in the next few days.
A Bombay Dyeing spokesperson declined to comment on the queries about the stake sale talks, terming them as speculations.
Banking sources, however, said the PE firms eyeing the stake included big global names such as WL Ross, Sequoia Capital and JC Flowers.
Phone calls and text messages to Jeh Wadia, managing director of Bombay Dyeing, and one of the two sons of group head Nusli Wadia, did not elicit any response.
The Bombay Dyeing spokesperson said in an e-mail that “the company does not wish to comment on baseless and false rumours”.
Sources, however, said the due diligence was in an advanced stage, and the Wadias plan to use the sale proceeds for its realty arm Bombay Realty, which has a couple of posh projects underway and owns a huge land bank in Mumbai.
Promoters own about 52.3 per cent in Bombay Dyeing, while domestic institutions and foreign funds together have about a 20 per cent stake.
WL Ross has been bullish on the country for some time and has its pie in various sectors. It has made huge profits from a Rs 350-crore investment in low-cost carrier SpiceJet in the past. Sequoia is also heavily invested in the country.
New York-based JC Flowers has billions in investments and was set up in 2001 by a former Goldman Sachs partner, J. Christopher Flowers.
Private equity firms invested about $1.3 billion across 75 deals in the country during the quarter ended September 2013, registering a decline of 67 per cent over the corresponding period last year, according to a report by Venture Intelligence.
Baring Private Equity Asia’s Rs 1,687-crore ($260 million) buyout of a 41.8 per cent stake in Hexaware Technologies was the top deal of the September quarter, 2013.
The second-largest transaction was Flipkart’s raising of an additional $200 million from existing investors.