Blackstone Plans $1.25 Billion Stake Sale in India’s Knowledge Realty Trust
Global investment firm Blackstone Inc. has announced plans to sell a stake valued at up to $1.25 billion in India-based Knowledge Realty Trust. The divestment, scheduled for next week, will be conducted through an offer for sale and marks the private equity firm’s largest transaction of this type this year.
What Happened
According to regulatory filings and a term sheet reported by Bloomberg News, Blackstone will offer up to 11.1 million units of Knowledge Realty Trust, which corresponds to a 25.03% stake. The bidding window opens on August 31 for non-retail investors and on September 1 for retail investors.
The base size of the offering is set at approximately 79.9 billion rupees (around $838 million), with an additional greenshoe option valued at 39.96 billion rupees. The floor price for the sale has been fixed at 108 rupees per unit. This floor price represents a 4.7% discount compared to Friday’s closing market price and a 13% discount relative to the trust’s net asset value.
Key Highlights
- Total Deal Size: Up to $1.25 billion, comprising a base deal of roughly 79.9 billion rupees and a greenshoe option of 39.96 billion rupees.
- Units Offered: Up to 11.1 million units, representing a 25.03% stake in the trust.
- Floor Price: 108 rupees per unit, priced at a 4.7% discount to Friday’s close and 13% below its net asset value.
- Bidding Schedule: August 31 for non-retail market participants and September 1 for retail investors.
- Shift in Ownership: Blackstone’s shareholding will fall from 46.5% to 21.5% if the greenshoe option is exercised in full, positioning joint venture partner Sattva Group as the largest unitholder with a 32% stake.
Why This Matters
The transaction represents a notable realignment of ownership within Knowledge Realty Trust. If the greenshoe option is fully executed, Blackstone will reduce its holding from the current 46.5% to 21.5%. Consequently, joint venture partner Sattva Group will step into the position of the single largest unitholder, holding a 32% stake in the trust.
Knowledge Realty Trust, which went public in August of the previous year, operates a substantial real estate footprint comprising 29 corporate business parks spanning six Indian cities.
What to Watch Next
The immediate steps will be the opening of the offer for sale, starting with the non-retail bidding window on August 31, followed by the retail subscription period on September 1. Market observers will also see whether the full greenshoe option of 39.96 billion rupees is exercised, which will determine the final stake held by Blackstone and Sattva Group.
Frequently Asked Questions
What is the floor price of the offer for sale?
The floor price has been set at 108 rupees per unit, which reflects a 4.7% discount to the previous Friday’s closing price and a 13% discount to the trust’s net asset value.
When does the sale open for retail investors?
Retail investors will be able to participate on September 1, following the opening for non-retail investors on August 31.
Who will become the largest owner after the sale?
If the greenshoe option is exercised completely, joint venture partner Sattva Group will become the largest unitholder in Knowledge Realty Trust with a 32% stake, while Blackstone’s holding will decrease to 21.5%.
Source: Report based on details shared by Business Standard and Bloomberg News.