INDIA BUSINESS WORLD - OCTOBER 21st - NOVEMBER 15th
- 2007
BLACKSTONE SET TO PICK 26% IN MTAR FOR $65 M
Private equity (PE) major Blackstone has struck yet another deal in India. It is picking up 26% in MTAR Technologies for $65 million (about Rs 260 crore), in one of the first PE deals in the defence and nuclear science space. Hyderabad-based MTAR, a privately-held company promoted by P Ravindra Reddy, Satyanarayana Reddy and P Jayaprakash Reddy, makes critical components and products used for nuclear and space projects.
The funding is through a mix of additional issue of shares and equity sale by the promoters. MTAR will continue to be led by the original founders, who will hold 74% cumulatively. After the deal, Blackstone will have three representatives on the 12-member board of the company.
According to MTAR chairman P Ravindra Reddy, "The funds will be used for the expansion of our manufacturing facility for nuclear and aerospace apart from di versifying into oilfield equipment."
"The company is in a niche but interest ing area, where we see long-term value wi th the growth capital that we are providing If the Indo-US nuclear deal goes through, it will bring a bigger upside than what we ha ve built into our valuation," said Blackstone Advisors India chairman Akhil Gupta.
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