Blackstone completes exit from India's Sona Comstar

Stock exchange data confirmed the sale of about 120m shares on March 13 at INR 410.04 apiece, equating to total proceeds around INR 49.2bn (USD 597m).

Earlier the same day, Livemint had reported the sale was expected to generate up to USD 640m on the back of high demand. The stock has traded down, however, falling 6.8% during the March 13 session to close at INR 406.2, giving the company a market capitalisation of INR 237.8bn.

Blackstone realised proceeds of INR 40.4bn through a partial exit in August last year, when it sold 79.4m shares for INR 509.10 apiece. That deal reduced the investor’s position from 34.1% to 20.5%. Based on the stock price at the time, the 20.5% stake was worth about USD 785m.

Sona Comstar, which officially trades as Sona BLW Precision Forgings, is the product of a merger and ambitious value creation plan that redirected two traditional Indian automotive players into an innovation-oriented systems and components maker for domestic and global markets. Importantly, this has included an expansion into supplying electric vehicles.

Blackstone paid USD 300m for a 33% stake in Sona BLW in 2018, and then – working alongside promoter Sunjay Kapur – supported a merger with Comstar Automotive Technologies, one of its own portfolio companies. It acquired full ownership of Comstar earlier the same year for USD 150m, taking out Argyle Street Management and the Chandra family.

Sona Comstar’s INR 55.5bn IPO in mid-2021 was the largest by a PE-controlled company in India, with Blackstone receiving INR 52.5bn of proceeds as it scaled its position from 66.3% to 34.2%. Currently, the stock is 39.6% above the IPO price.

“The company's strategy is well set with a strong order book and business development function, its focus on innovation and new technology, and building on its excellent engineering capabilities,” Amit Dixit, head of Blackstone Private Equity in Asia, said in a statement.

“It will continue to be a leader in its segment and is well-placed to play an important role in the global transition to greener and safer mobility. We will always be a supporter and seek to collaborate and partner with the company going forward as we continue to evaluate investments in the energy transition theme.”

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• Topics
• South Asia
• Industrials
• Cleantech
• Open market
• The Blackstone Group
• Fidelity
• automobiles
• Electric Vehicles
• manufacturing