Blackstone Group close to acquiring Mphasis for $1billion

17 Mar 2016 | By Vaneet Randhawa

Blackstone Group, the world's largest private equity investor is very close to its acquisition of the IT firm Mphasis in an almost $1 billion deal.

Blackstone is seen outbidding two of its strong contenders - Apollo Global Management and Tech Mahindra to acquire Mphasis.

Market experts believe Blackstone will 'fund' Mphasis' growth by "investing in the new offerings" and help in its growth.

In context: Blackstone: Journey of the private investment giant

Introduction The Blackstone Group

Blackstone Group is a private equity firm that was established in 1985 by Peter G. Peterson and Stephen A. Schwarzman.

Blackstone emerged as one of the world's largest private equity investment firms.

Blackstone concentrates in "private equity, credit and hedge fund investment strategies, as well as financial advisory services, such as mergers and acquisitions (M&A), restructurings and reorganizations, and private placements."

1990sReal estate investment business

Blackstone began its real estate investment venture by acquiring hotel businesses under Henry Silverman's leadership in 1991 in Ramada and Howard Johnson franchises.

Blackstone's other notable investments in the early and mid-1990s included "Great Lakes Dredge and Dock Company (1991), Six Flags (1991), US Radio (1994), Centerplate (1995), MEGA Brands (1996).

In October 2000, Blackstone earned the lease for 7 World Trade Center.

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The buyout boom years 2005-2007

2005-2007The buyout boom years 2005-2007

During the buyout boom of 2006 and 2007, Blackstone completed some of the largest leveraged buyouts.

The most noteworthy ones included TDC ($11 billion), Equity Office ($37.7 billion), Freescale Semiconductor ($17.6 billion), Travelport ($4.3 billion.) and Biomet ($11.6 billion).

It were the boom years buyouts that helped Blackstone edge closer towards its dream to create a business development company (BDC).

2007Initial public offering

After 2 failed attempts, Blackstone filed to raise $4 billion in an initial public offering on 22 March 2007.

On 3 June 2007, it acquired one of the largest insurance brokerage firms Alliant Insurance Services.

On 21 June, Blackstone auctioned a "12.3% stake in its ownership for $4.13 billion in the largest U.S. IPO since 2002."

Blackstone shares were priced at $31 per share.

One of the largest employers in US

As the largest alternative asset management firm in the world, Blackstone employs over 780,000 employees making it one of the largest employers in the US.

2011-15Blackstone continues to strengthen its empire

2011: Blackstone acquired 588 malls of Centro Properties Group's U.S. shopping centers, German outdoor company Jack Wolfskin.

2012: The company bought G6 Hospitality, and a controlling interest in Vivint, Vivint Solar, and 2GIG Technologies.

2014: It purchased a 20% stake in Versace.

2015: Acquired Excel Trust Inc, BioMed Realty Trust Inc and agreed to sell its trophy office assets in the Los Angeles market.

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17 Mar 2016Blackstone Group close to acquiring Mphasis for $1billion

4 Apr 2016Blackstone set to buy HP's stake in Mphasis

Private-equity giant Blackstone bought a majority stake in Mphasis for up to $1.1billion from Hewlett-Packard Enterprise.

Blackstone will pay "430 rupees ($6.49) per share for at least 84% of HP Enterprise's 60.5% stake in Mphasis".

Blackstone said it was not planning to replace Mphasis' present management led by CEO Ganesh Ayyar.

It also revealed that it didn't plan to delist Mphasis from stock exchanges.