In the first private equity deal struck by Chennai-based, Rs 1,400 crore auto component group ,Rane, Mumbai-based private equity investment firm Blue River Capital has picked up 10.22% stake in Rane Holdings (RHL). Blue River has invested $4.7 Million in the holding arm of the Rane group and the Rs 10 paid up share of RHL was valued at Rs 192. On Friday September 31, RHL scrip closed at Rs 156 on BSE. It has acquired the stake from the promoter group through a secondary market transaction. The PE firm has made the investment in the holding arm of the family business group through its Mauritius-based investment company. Its representative is expected to join the board of Rane Holdings shortly. “After RHL made the preferential allotment to promoters followed by a open offer to the public, the promoter stake had touched 72%. As we did not expect the stake to such a high level and wanted to bring down the holding to around 60%, we looked around for investors. Blue Metal showed interest in picking up the promoter' stake,” Rane group chairman L Ganesh told ET. He said the PE investment will help in enhancing shareholder value of Rane companies. As a long term investor, Blue River is expected to hold its stake for four to five years, Mr Ganesh added. Stating this is the first private equity investment which has taken place in the Rane group, Ganesh noted after the current final phase of the consolidation of the holdings of group companies into RHL, to be completed by March 2008, the promoter stake in RHL will stabilise at 45-46%. It has no plans to further dilute stake. Also, the group wants to retain 50% stake in all the companies through RHL. […]