Bain in fray for Piramal Glass with US $ 900mn bid

LIVEMINT: Bain Capital has made a US $ 900 million preliminary bid for a controlling stake in Piramal Glass (Pvt.) Ltd, two people directly aware of the development said. 

The offer tops one made by rival Blackstone Group as the private equity giants vie for the glass-packaging maker amid surging global demand for vials to store COVID vaccine candidates.

Bain Capital’s offer, which came over the weekend, is more than Blackstone’s group binding offer of close to US $ 790 million for the company, the two people cited above said, requesting anonymity as the talks are private.

“Bain is a late entrant but has made a higher offer of close to US $ 900 million,” said one of the two people. 
“Piramal group is seeking an enterprise valuation of around US $ 1 billion.”

The second person said Blackstone’s offer is valid till November 4 and “Bain is expected to make a binding offer by then”. 

“In addition to Blackstone and Bain, there are two more bidders in the race,” the person said.

Piramal Group and Blackstone did not respond to the emailed queries until press time. A spokesperson for Bain Capital declined to comment.

The interest in Piramal Glass comes as the pandemic leads to a global surge in demand for packaging across segments. Makers of vials and syringes have, for instance, started building up capacity in anticipation of a surge in demand if and when a successful COVID vaccine is launched in India—a market that could potentially touch US $ 6 billion.

Piramal Glass is a leading player in the global glass packaging industry and has seven units, of which two—Piramal Glass Ceylon PLC and Piramal Glass USA Inc.—have manufacturing sites in Sri Lanka and the US, respectively.

It has a total of five manufacturing locations—two each in India and the US and one in Sri Lanka—with a total production capacity of 1,410 tonnes per day, as on March 31, 2019.

A potential deal for Piramal Glass will mark another divestment by Piramal group, which is looking to shore up capital base of its real estate, pharma and financial services businesses through stake sales in non-core businesses.