Blackstone likely to acquire promoter stake in Cipla: What is Blackstone? Its history, big acquisitions and controversies

Shares of Cipla surged more than 6 per cent in morning trade on Friday to hit a fresh 52-week high amid the buzz over one of largest global private equity funds, Blackstone, eyeing to acquire promoter stakes in the pharma company.  

Cipla shares reached its all-time high of Rs 1238.55 in trade on Thursday. However, the stock trimmed its early gains and shares were trading 4.19 per cent higher at Rs 1213.85 apiece on BSE at 12:29 PM.

According to reports, Blackstone is expected to submit a non-binding bid by next week to acquire the entire promoter stake of 33.47 per cent in the Indian Pharma major.

Blackstone's history of high-profile acquisitions, such as the significant acquisition of Cvent Holding Corp. and R Systems International Ltd, underlines the firm's sweeping influence in the global market. Despite its name being rarely heard of in India, the company is one of the biggest corporate entities within India and a highly aggressive institutional investor.

Blackstone Inc: An Overview and History

Founded in 1985, Blackstone Inc. is a New York City-based American alternative investment management firm. It began as a mergers and acquisitions firm, evolving into a major player in leveraged buyouts and commercial real estate acquisitions. Blackstone operates across diverse sectors, including real estate, private equity, credit, and infrastructure. With an impressive asset management portfolio worth $50 billion in India alone and just under $1 trillion globally, Blackstone is a leading alternative investment firm.

Major acquisitions by Blackstone

Blackstone's assets span from real estate to IT services, making it an aggressive institutional investor. It's the largest office owner in India with an office portfolio of 135 million sq ft across seven cities. Apart from real estate, Blackstone's investments in the tech sector are also noteworthy. The firm has acquired a majority stake in digital services provider R Systems International Ltd and tech firm Mphasis, highlighting its strategic diversification into various sectors.

Blackstone Controversies

Blackstone's journey has been marred by controversies and criticisms. After the US housing crash, Blackstone, through its subsidiary Invitation Homes, became the largest owner of single-family rental homes in the country. This led to accusations of profiteering from the miseries of ordinary Americans. UN's housing advisor, Leilani Farha, accused the Blackstone Group of exploiting tenants and fueling a global housing crisis. The firm was criticised for inflating rents and imposing heavy fees and charges for ordinary repairs, having "devastating consequences" for tenants worldwide.