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Blackstone Group to invest in India's Allcargo Global

Blackstone Group LP, manager of the world's biggest buyout fund, agreed to pay 2.42 billion rupees (US$60 million) for a 10.4 percent stake in Indian logistics firm Allcargo Global Logistics Ltd.

New York-based Blackstone will buy 1.08 million Allcargo debentures worth 1.1 billion rupees, which can be converted into the same number of shares at 934 rupees apiece, a 31 percent premium compared with Tuesday's closing price, the company said in a National Stock Exchange filing.

The fund will also buy 1.5 million Allcargo warrants at 194 rupees each, which can also be converted into stock.

Earlier Purchases

The agreement follows on from Blackstone's previous purchases of minority stakes in Indian companies such as Hyderabad-based Nagarjuna Construction Co and MTAR Technologies Pvt, and a controlling stake in Bangalore-based garment exporter Gokaldas Exports Ltd.

Firms including Blackstone and the Carlyle Group are buying minority holdings to keep companies listed in India, since managers of local firms are usually averse to total buyouts.

Shares

Blackstone's Allcargo warrants will be converted into shares at a value of between 934 rupees and 1,284 rupees each, the statement said.

Shares in Allcargo, which was founded in 1993, rose 53.4 rupees, or 7.5 percent, to 768 rupees at 12:25pm on the Bombay Stock Exchange yesterday.

This compared with a 1.9 percent decline in the benchmark Sensex index.
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