Blackstone Drops Majority Stake Plans in Haldiram's Snacks Business

By Aditya Kalra

NEW DELHI (Reuters) – Blackstone (NYSE:BX) has halted its plans to acquire a majority stake in the snacks business of India's Haldiram's. It is now discussing the purchase of a 20% stake at a valuation of $8 billion, which remains a point of contention, sources informed Reuters on Thursday.

Haldiram's holds a nearly 13% share of India's $6.2-billion savoury snacks market, according to Euromonitor International, and operates more than 150 restaurants. The company’s popular snacks business has attracted interest from many foreign investors.

In May, Reuters reported that a consortium led by Blackstone was considering a 75% stake in the business and had made a non-binding bid. However, these discussions fell through as Haldiram's is now less inclined to sell a large stake, as per the anonymous sources.

"Blackstone is keen to close the transaction as a lot of effort has gone into it," revealed one source with direct knowledge of the situation.

Challenges remain regarding valuation; Haldiram's seeks to value the snacks business at $12 billion, while Blackstone aims for a deal at $8 billion. Two sources stated that the stake size under discussion is around 20%, while a third indicated a range of 15% to 20%. Blackstone continues to aim to invest in the company.

Haldiram's CEO Krishan Kumar Chutani and Blackstone have not commented on the matter.

Additionally, Bain Capital, Singapore's state investor Temasek, and the Abu Dhabi Investment Authority (ADIA) are also looking into acquiring a minority stake in Haldiram's, although plans are not detailed.

Temasek declined to comment on speculation, Bain also declined, and ADIA did not respond.

Last year, discussions between India's Tata Group and Haldiram's for a majority stake in the entire snacks and restaurants business were reported, with Haldiram's then seeking a $10 billion valuation. Those talks, however, did not result in a deal.

Haldiram's history dates back to 1937, originating as a small shop in Bikaner, Rajasthan. One of its most well-known products is "bhujia," a crunchy Indian snack made from flour, herbs, and spices, sold for around 10 rupees (12 U.S. cents) in local stores.