Kedaara Capital invests Rs 200 crore in Parksons Packaging

Mumbai: Local private equity fund Kedaara Capital Tuesday said it has invested Rs 200 crore to purchase a significant minority stake in unlisted cartons and paper packaging company Parksons Packaging Ltd through a mix of existing stake from rival PE fund Chryscapital and fresh shares from promoters.

Chrys Capital, which purchased 21% stake in the company for Rs 50 crore in 2006, made more than two fold return from the exit.

Founded in 1996 by Ramesh Kejriwal and managed by his two sons, Siddharth and Chaitanya, Parksons supplies its products to drug makers, soaps and paste makers and its key customers Hindustan Unilever, L'Oreal, Godrej, McDonald's, Kellogg's, Cadbury, Wockhardt and Ranbaxy. 'Kedaara's promoter partnership model, strong industry networks, and unique understanding of the consumer and healthcare industry, will add significant value to Parksons and help further strengthen our position as India's most preferred and innovative paper packaging solutions provider," said Ramesh Kejriwal, Chairman, Parksons Packaging. It's operating model will enhance Parksons' performance, bringing in global experience and best practices to strengthen our offering.

Indian packaging industry market is likely to touch $43.7 billion by 2016, according to Indian Institute of Packaging (IIP). India's packaging industry is growing at 12 per cent per annum, compared to the global growth rate of 5 per cent, according to IIP.

According to Manish Kejriwal and Sunish Sharma, managing partners of Kedaara Capital, the transaction is in line with the firm's focus of investing in leading businesses driven by talented entrepreneurs.

"This is an opportune time to invest in the Indian packaging sector, with Parksons being especially well-positioned to benefit from the growth in the Indian consumption story," they said in a release.

"With a best-in-class management team, a key differentiator in the highly fragmented packaging sector, Parksons leverages its well-diversified exposure across multiple sectors, roster of marquee global and local customers, and strong design and innovation capabilities to offer a unique value proposition to all its customers."

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.