PE firm Lighthouse ups stake in plastics parts maker

 PE firm Lighthouse ups stake in plastics parts maker

Indian mid-market private equity firm Lighthouse Funds has increased its stake in a plastics parts maker that it first backed nearly a decade and a half ago and returned to re-invest last year.

Lighthouse, which made at least three investments in 2021 and added gifting platform Ferns N Petals to its portfolio earlier this month, has acquired an additional 2.48% stake in Shaily Engineering Plastics Ltd from the company’s promoters.

The PE firm, which is investing out of its $250-million third fund, shelled out roughly Rs 38.36 crore ($5.04 million) to increase its stake. After the deal, Lighthouse’s stake in Shaily Engineering will stand at 8.01%.

Previously, it had committed Rs 90 crore ($12.1 million) in Shaily Engineering last August. Lighthouse’s investment was part of a larger transaction wherein Shaily Engineering raised Rs 150 crore by allotting shares on a preferential basis. While Lighthouse invested Rs 90 crore, funds managed by White Oak Capital pitched in with Rs 60 crore.

White Oak is an investment advisory and hedge fund company led by former Goldman Sachs executive Prashant Khemka. Lighthouse got a 5.6% stake in the company at the time while White Oak picked up around 3.7%.

Shaily Engineering allotted the shares at Rs 1,755 each. The company’s shares had more than tripled over the past year and half. After touching a high of Rs 2,000 apiece, the company’s stock has lost nearly 15% of their value.

Shares of Shaily closed at Rs 1,700.50 apiece on the BSE Thursday, down 1.6% from the previous close.

Lighthouse had first invested in Shaily in 2007 and sold almost all its stake in 2015, clocking a return multiple of four to five times on its investment, according to media reports at the time.

Vadodara, Gujarat-based Shaily Engineering makes high-precision injection-moulded plastic components for medical devices companies and toymakers. It also caters to clients in several other sectors such as home furnishings, personal care, carbon steel furniture, automotive and engineering components, and appliances.

Apart from Shaily Engineering, Lighthouse last year reinvested in medical devices maker Poly Medicure Ltd and increased its stake in snacks maker Bikaji Foods Ltd to above 10% from a tad below 7.5%. Lighthouse also made several exit moves last year, including from cosmetics firm Nykaa.

Lighthouse focuses on consumer-centric sectors such as food and beverages, healthcare, personal care, consumer durables, and financial services. It has previously invested in companies such as ethnic apparel maker FabIndia, footwear maker Aqualite Industries and non-bank lender Capital Trust.

Ankit Doshi

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