Indorama to pick up 24.9% stake in EPL Ltd from Blackstone for $220 million

Bengaluru: Indorama Ventures Europe (IVE) will acquire a minority stake of about 24.9% in EPL Limited, a global specialty packaging company and manufacturer of laminated tubes, from private equity firm Blackstone for $220 million.

The sale, which is expected to be completed in the coming months, is pegged at ₹240 a share and is subject to customary closing conditions and approvals. Once the transaction is completed, Indorama will be entitled to appoint a nominee director to the board of EPL, it said in a statement. 

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Anand Kripalu, managing director and chief executive of EPL said, “This partnership has resulted in meaningful growth by increasing presence in emerging markets, focusing on sustainable tubes, and increasing our market share in the fast-growing beauty, cosmetics and pharmaceutical industries.”

Morgan Stanley was the exclusive financial advisor to Blackstone while Trilegal and Simpson Thacher were its legal advisors. Goldman Sachs was the exclusive financial advisor to IVE, and Khaitan & Co and Chandhiok & Mahajan were its legal advisors.

Expansion plans

Indorama will help EPL expand geographically, especially in countries such as Thailand and Nigeria, Anand Kripalu, managing director and CEO of EPL said in an interview with Mint.

“We see this partnership meaningfully accelerating our growth and performance. EPL has already announced a capex plan in Thailand, and as Indorama has its headquarters in the country, it will help EPL accelerate those plans,” Kripalu added.

On valuation, Kripalu said EPL stock had seen significant appreciation since 2019, when Blackstone came in. However, the recent stock market turmoil, especially in mid cap stocks, has caused a significant correction in value in the market. Blackstone retaining a significant stake in the company indicates that the investor sees more value in it, Kripalu said.

Shares of EPL fell more than 8% on Monday after the the deal was announced.

Blackstone’s 2019 buy

In 2019 Blackstone acquired 75% of EPL for $470 million ( ₹134 a share) from erstwhile promoter Essel Group and public shareholders. This was followed by large sale of shares – representing almost a quarter of the total shareholding – to various institutional investors through block trades in September 2020.

The buyers included institutional investors such as Axis Mutual Fund, IDFC Mutual Fund, Aditya Birla Sun Life Mutual Fund, Nomura, Franklin Templeton Mutual Fund, DSP Mutual Fund, Government Pension Fund Global and Neuberger Berman. Blackstone sold 72.58 million shares at ₹256.5 each for a total of $252 million.

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Founded in 1982, EPL has about 21 facilities in 11 countries, more than 3,500 employees, and produces more than eight billion tubes a year. Its clients include brands in the oral care, beauty, cosmetics and pharmaceutical industries. 

Revenue from operations for the nine months to 31 December 2024 was ₹4,137 crore and Ebitda was ₹806 crore, reflecting about 17% year-on-year growth. EPL aims to increase its presence in emerging markets and ramp up its focus in the fast-growing beauty, cosmetics and pharmaceutical segments.

Indorama Ventures has a global manufacturing footprint across Europe, Africa, the Americas and Asia Pacific. The company’s portfolio comprises combined PET, fibers, Indovinya and Indovida. Its products serve the FMCG, agricultural, lifestyle and automotive sectors in the beverages, hygiene, personal care, tires, and safety segments. In 2023, the company reported revenue of $15.6 billion.

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