New Delhi, Aug. 12 -- Blackstone, the world's largest alternative asset management platform, is sitting on strong notional gains on its investment in Horizon Industrial Parks Ltd as the Indian industrial and logistics platform goes public.
Horizon, which Blackstone acquired in 2021, is set to raise Rs 2,600 crore ($272 million) through a fresh issue of shares in its initial public offering. The company will use up to Rs 2,250 crore to repay debt.
The issue opens August 17 and closes August 19. Horizon has fixed a price band of Rs 57-60 per share. At the upper end of the price band, the company will command a post-IPO valuation of Rs 17,297 crore ($1.8 billion) and a pre-money valuation of Rs 14,697 crore ($1.54 billion).
Horizon filed its draft IPO documents last December and received regulator approval earlier this year. Ahead of filing the draft documents, Horizon had raised Rs 1,650 crore in a pre-IPO round from 360 ONE, SBI Life Insurance, State Bank of India, Radhakishan Damani, EAAA and DSP Investments. This round valued the company around Rs 14,651 crore ($1.54 billion).
Blackstone is not selling any stake in the IPO. It currently owns an 88.74% stake in Horizon, which is worth Rs 13,042 crore at the upper end of the price band.
Blackstone acquired Embassy Industrial Parks from the Embassy Group and Warburg Pincus in 2021 and renamed it Horizon Industrial Parks. Overall, it has invested Rs 3,696 crore in Horizon. This includes about Rs 2,860 crore in primary infusion and remaining in secondary purchases from Embassy and Warburg Pincus.
Blackstone also merged two entities, BRE Asia III India Holdings Ltd and BRE Asia Urban Holdings, with Horizon in 2024 and 2025 through non-cash transactions. The derived value of its investments in those two entities is around Rs 2,100 crore, back-of-the-envelope calculations show.
Excluding the non-cash transactions, Blackstone's multiple on invested capital from Horizon stands at around 3.5x while its unrealised internal rate of return (IRR) would be around 50% in rupee terms. This is far higher than the 20% annualised return that most PE firms aim for in local currency terms.
Horizon has a portfolio spanning nearly 60 million square feet, of which around 27 million sq ft has been completed. Its assets are spread across 45 parks in 10 cities.
Asheesh Mohta, head of real estate in India at Blackstone, ruled out large capital raises going forward.
"I don't anticipate needing any more capital to finish 60 million square feet. I don't see us raising any capital if we just continue to acquire 4-5 million square feet going forward every year that we've done in the past," he said, adding that the firm may raise capital only in case of a large project.
"The way I see this business, it's self-sufficient. It has stable income and a growth portfolio that's fully paid for. It's on autopilot," he said.
Published by HT Digital Content Services with permission from VC Circle.