Global private equity firm Blackstone has struck a deal to buy a minority stake in travel, transportation and logistics technology firm IBS Software from General Atlantic and other unnamed investors for $170 million (Rs 1,137.5 crore), in its second India-related investment this year.
The deal also involves a primary component where Blackstone will invest into the firm, even as a good chunk of the transaction amount is expected to go to selling shareholders.
The transaction is expected to close within a month, subject to customary regulatory approvals, as per a press statement on Wednesday.
General Atlantic, which had invested in IBS in 2007, will exit in this transaction. Early this year, it had also exited Jubilant Life Sciences.
It had invested $53.5 million to pick 22 per cent stake in IBS, according to VCCEdge, the data research platform of VCCircle.
IBS Software that inked a string of M&As to expand its business since then has seen its revenues rise around three times but its profit growth has not matched up to this pace, as per VCCEdge.
"We see a huge synergy from Blackstone's portfolio of companies and their extensive experience in the travel and hospitality space," VK Mathews, founder and executive chairman of IBS Group, said.
IBS has nearly 3,000 professionals across nine offices and provides software products to global airlines, airports, cruise lines, travel distributors and oil and gas companies.
"IBS is a Software as a Service (SaaS) company with intellectual property in the aviation, travel and hospitality verticals across the globe. We foresee significant growth opportunity for IBS, driven by the company's deep domain knowledge, its portfolio of products and roster of customers," Amit Dixit, senior managing director and co-head of private equity in India at Blackstone, said.
It is the second tech sector investment in India by the PE firm this year. In September, Blackstone signed an agreement with UK's Serco Group to buy majority of its private sector business process outsourcing (BPO) operations for £250 million (Rs 2,558 crore or $385 million), in its
single-biggest PE deal in India.
For the alternative investments giant which has been a more active investor in the real estate sector in India lately, this was the first addition to its PE portfolio in the country in almost two years.
Blackstone has invested around $5 billion since it started its India unit in August 2005.