Block Deal: JB Chemicals & Pharma shares in focus as KKR likely to sell 10.2% stake

Shares of JB Chemicals & Pharmaceuticals Ltd will be in focus during the trading session on Thursday as the global private equity major KKR is likely to sell 10.2 per cent stake worth $2,750 crore or $300 million through the block deal, suggested some media reports. KKR will be selling the stake through its affiliate arm Tau Investment Holdings.

The floor price for the block deal was at Rs 1,625 per share, discount of nearly 5 per cent against its previous close at Rs 1703.40 on Wednesday. The base offer comprises 1.06 crore equity shares (6.8 per cent stake) worth Rs 1,805.60 crore, along with a greenshoe option of 0.53 crore shares (3.4 per cent stake) valued at ₹902.80 crore.

Tau Investment Holdings held a 53.66 per cent stake in JB Chemical & Pharma as of December 31, 2024. KKR bought a 54 per cent stake in JB Chemicals for Rs 3,109 crore in 2020. The deal was executed at a price Rs 745 apiece, which was followed by a 1:1 stock split in September 2023, resulting in a face value of Re 1. KKR made returns of more than 335 per cent since the takeover.

IIFL Capital Services, Jefferies India, Kotak Securities, and Spark Institutional Equities are the book running lead managers for the transaction. The total market capitalization of the company stood more than 26,500 crore on Wednesday. The stock has gained more than 13 per cent in the last two weeks.

KKR has been considering selling its controlling stake in JB the past year. It held discussions with strategic suitors as well as private equity players to exit JB Chemicals and Pharmaceuticals and sell its entire stake in 2025. However, the deal could not take place due to a valuation mismatch.

JB Chemicals and Pharmaceuticals posted a 21.64 per cent year-on-year (YoY) increase in net profit, while its revenue from operations increased by 14 per cent YoY to Rs 963.4 crore in the December 2024 quarter. Ebitda was up 14.1 per cent to Rs 254.5 crore with the Ebitda margins came in at 26.4 per cent for the quarter.