Three global funds – Partners Group, CVC Capital and Blackstone Group – are in talks with a bunch of investment banks for financing arrangements to back their recent acquisitions, multiple sources with knowledge of the matter told ET.
In August, Partners agreed to buy a controlling stake in Atria Convergence for around $1.2 billion, while Blackstone signed a definitive agreement to buy ASK Group for around $1 billion. CVC Capital is in the final stages to acquire Sajjan India in a near $1- billion deal.
“The PE firms have signed definitive agreements and are fine tuning the finances to back these acquisitions,” said one of the sources cited above.
Partners Group is aiming to raise up to $400 million, while Blackstone is seeking to raise about $200 million. CVC Capital is planning to garner about $300-350 million, the source said.
The latest transaction would be in addition to Blackstone’s $1.1-billion financing raised to buy into Mphasis in July, said another source.
HSBC, ING, Investec, Deutsche Bank, BNP Paribas, Nomura and JP Morgan are among other investment banks currently negotiating a likely five-year overseas loan, linked to LIBOR (London Interbank Offered Rate), a global gauge that will go out of life by 2023.
There would be a replacement clause, which will use an alternative matrix like Secured Overnight Financing Rate (SOFR).
Individual banks could not be contacted for comments.
Partners Group declined to comment on the fundraising. Blackstone, CVC Capital did not respond.
Earlier in August, ET reported that Baring Asia is in talks to raise at least $600 million to finance its acquisition of the healthcare BPO unit from Hinduja Global Solutions.
Leveraged acquisition is on the rise in India as private equity funds are increasingly adopting a method of acquisition financing against the balance sheet of the target entity. In July, Blackstone and its co-investors including Abu Dhabi Investment Authority, GIC and University of California Investments raised $1.1 billion to finance a $2.9-billion acquisition of Mphasis.
M&As involving Indian companies hit a three-year high during the first nine months of 2021, according to data compiled by Refinitiv. Between January and September this year, transactions worth $90.4 billion were announced, representing an increase of 35.1% compared with the same period a year ago, the data showed.
