Blackstone Notches Another India Payday Selling Down Outsourcer

(Bloomberg) -- Blackstone Group LP raised about $220 million paring its stake in Indian IT services firm Mphasis Ltd., people with knowledge of the matter said, generating another windfall in a country that’s become its top-performing market globally.

The sale generated a return of about four times on Blackstone’s investment to buy the stock, according to the people, who asked not to be identified because the information is private. Blackstone sold 15.46 million Mphasis shares, representing an 8 percent stake, at about 960 rupees apiece through block trades Monday, the people said. Shares of Mphasis closed Friday at 988 rupees.

Blackstone’s $825 million takeover of Mphasis in 2016 was its largest-ever purchase in India. The private equity firm has revamped its strategy in the country, focusing on bigger buyout deals and concentrating on select sectors like consumer and information technology where it expects the most wealth creation, Bloomberg News reported in March.

A representative for Blackstone declined to comment on the returns from its Mphasis sale.

Blackstone confirmed earlier Monday it had cut its stake in the Bengaluru-based technology services provider.

The sale will “create more liquidity in the stock and enable high quality long-term investors to participate in the Mphasis growth story,” it said in an emailed response to Bloomberg queries. Blackstone doesn’t currently intend to sell any additional stake, it said.

Blackstone paid 430 rupees per share when it bought a majority stake in Mphasis from Hewlett Packard Enterprise Co. in 2016. That initial takeover was funded with about half equity and half debt, the people with knowledge of the matter said.

To contact the reporter on this story: George Smith Alexander in Mumbai at galexander11@bloomberg.net.

To contact the editors responsible for this story: Ben Scent at bscent@bloomberg.net, Arijit Ghosh

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