PE giants line up for RedTape in deal valuing footwear maker at up to ₹5,000 crore

Subscribe to enjoy similar stories. MUMBAI : Global private equity firms including Apax Funds and Advent International have joined the race to acquire a majority stake in RedTape, in a transaction that could value the Indian footwear maker at ₹4,500–5,000 crore (about $500 million), three people familiar with the matter said on condition of anonymity. The proposed deal marks one of the largest private equity plays in India’s branded footwear space, and comes amid rising investor interest in the country’s consumer-facing family-owned businesses.

Talks are at an early stage, and the promoters have mandated EY to advise them on the process, one of the people cited above said, adding that the consultancy has sought non-binding bids. The second person said that the Noida-headquartered company’s promoters may sell all or a substantial part of their holdings. The promoters held 71.79% of the company, according to the shareholding pattern on the NSE as of December.

“Warburg Pincus may also join the fray and compete for the majority stake," the third person cited above said. Earlier this month, Reuters first reported on the promoters’ plan to divest their stake, with KKR and Blackstone expressing interest in the asset. RedTape’s shares rose 4.05% to close at ₹123.83 on Friday on the National Stock Exchange, compared to the benchmark Nifty 50’s fall of 0.39%.

Over the past year, the company’s stock has declined 29.57%. Its market capitalization on Friday was ₹6,845.42 crore. KKR, EY, Advent, Warburg and Apax Funds declined to comment on the matter.